Incentives too low to create affordable housing: Urban Taskforce

Incentives too low to create affordable housing: Urban Taskforce
Chris JohnsonDecember 7, 2020

The report for the South Sydney Regional Organisation of councils on the Affordable Rental Housing SEPP is missing opportunities to improve the policy.

The City Futures report on the Affordable Rental Housing State Environmental Planning Policy (ARHSEPP) for the South Sydney Regional Organisation of Councils recommends that this policy document be replaced but all it needs is modifications to make it more useful.

The report says the infill affordable housing section has had little impact in South Sydney but this is because the incentives are too low.

Currently the ARHSEPP requires at least 20 percent of a project to be affordable rental housing but only gives a bonus uplift of around 8 percent.

Clearly the economics are not working to encourage developers to use this formula.

Rather than replacing the whole policy all that is required is to match the 20 percent affordable housing component with a 20 percent uplift in floor space.

This will make the provision of affordable rental housing much more viable for the 10 year rental period the policy requires.

The report also criticises the Boarding Houses component of the ARHSEPP yet it does indicate that these have rentals that are 20-40 percent cheaper than equivalent apartments in areas away from universities.

The City Futures report raises concerns that the boarding houses do not conform to the strict rules required for apartments through the Apartment Design Guide (ADG).

The boarding house model is a different model with shared communal spaces that provide a different approach to amenity.

Recent changes made to car parking requirements also makes boarding house developments unfeasible in many inner areas of Sydney, where there is a critical under supply of affordable accommodation.

The Urban Taskforce believes the intent of the Affordable Rental Housing SEPP is good but that the details are stopping successful implementation of the policy.

Discussion with the industry that produces housing would lead to improvements to the ARHSEPP that would help provide significant numbers of new affordable homes across Sydney.

It would have been useful if the City Futures report had made positive suggestions about where changes could be made to achieve the intended outcomes.

CHRIS JOHNSON is the Urban Taskforce CEO.

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