Proposed Housing Reforms


Ruby Burns


NSW Diverse and Well Located Housing Reforms



NSW Diverse and Well Located Housing Reforms

The Department of Planning and Environment (DPE) NSW is seeking public feedback on proposed housing reforms for more diverse low and mid-rise housing offerings in well-located areas across the State.

NSW Diverse and Well Located Housing Reforms

Currently, each local Council has its own regulations for the types of residences that can be built in their area, pursuant to individual Local Environmental Plans (LEPs). Individual LEPs often stipulate restrictive controls and discourage new housing, regardless of site-specific accessibility to transport, infrastructure, and social amenities.

The proposed planning reforms aim to fast-track low and mid-rise housing in NSW in response to housing capacity targets across the Greater Sydney region, Hunter, Central Coast, and Illawarra-Shoalhaven.

The proposed reforms have been developed based on the identified gap in the approval of residential density across the state; specifically, in the R2 Low Density Residential and R3 Medium Density Residential zones where low and mid-rise density housing has largely been ignored. For example, only 6% of the LEPs across Sydney currently allow terraces and one-to-two-storey unit blocks under R2 zoning.

The proposed reforms specifically look to increase housing capacity in R2 and R3 zones – targeting the ‘missing middle’ often restricted by individual LEPs and legislated built-form controls.

DPE proposes a new State Environmental Planning Policy (SEPP) to enact these changes and encourage ‘good’ density through the missing middle in well-located areas across the state.

The proposed new SEPP seeks to encourage this ‘missing middle’ by allowing:

  • Dual occupancies in all R2 zones across NSW.
  • Terraces, townhouses and two-storey apartment blocks in well-located areas close to public transport and centres in R2 zones across Greater Sydney, Hunter, Central Coast and Illawarra regions.
  • Mid-rise apartment buildings within 800m of transport hubs and centres in R3 zones and some appropriate employment zones.

Once adopted, the proposed new SEPP would override individual LEPs to permit low and mid-rise housing where compliant with the new controls.

The new SEPP also looks to include ‘non-refusal standards’ governing lot sizes, floor space ratios and building height, to override LEP provisions if it is lower than the SEPP standard. This is arguably a step in the right direction to address the housing crisis in NSW, although the need for such planning reforms is somewhat reflective of the overcomplex state planning system.

The proposed amendments will go on public exhibition next week via an Explanation of Intended Effects (EIE) and DPE expects the new SEPP to come into effect in June 2024.

More information can be found here.