Planning for Affordable Housing in Australia

State and territorial programmes for supporting affordable housing supply through the planning process are summarised in Table 9.3. As shown, inclusionary zoning requirements apply in only three jurisdictions, whilst planning concessions or density bonuses to secure affordable housing exist in four. There has been more extensive use of government land as part of wider redevelopment efforts, although the proportion of affordable housing delivered on public sites has varied from nothing to around 15 % of new dwellings (increasingly the case in South Australia and the ACT). In South Australia and Western Australia, low-cost home ownership initiatives have been supported by special shared equity and loan finance schemes. These ensure that low-cost home ownership products are accessible to the target groups of lower- and moderate-income working households.

The politics of housing policy have also acted to inhibit local governments in using their planning powers to secure dedicated affordable housing opportunities. Constraints in state planning politics and

Table 9.B Summary of state programmes to support affordable home ownership/rental housing development through the planning and housing development process



Inclusionary zoning

Density bonus/concession

Govt, land able to support affordable housing schemes3




Government loans for eligible households


15-25 % target, new land release

Applies to affordable home ownership scheme





In designated parts of inner Sydney

Statewide policy, to encourage affordable rental housing

On an ad hoc basis



Subsidised loans for eligible households




15 % target for residential zones (applied on rezoning)

To support achievement of target


For eligible households

For eligible households






For eligible households

For eligible households

including via government land development organisations

(Source: the authors, drawing on Gurran et al. 2008; Milligan et al. 2009; Davison et al. 2012) restrictive legislation have inhibited the development of inclusionary schemes, often reflecting the influence of the property industry which has maintained strident opposition to mandatory inclusionary zoning (Gurran and Phibbs 2016). Further, local councillors may face the wrath of well-heeled residents if they support significant change to established neighbourhoods, whilst others are also unwilling to alienate potential developers by introducing affordable housing obligations. There is long-standing local ambivalence or hostility towards public or affordable housing, which retains a stigma associated with the (now) residualised and unsympathetic developments of the 1970s and 1980s. Particular hostility erupted during the rapid roll out of social housing projects between 2009 and 2012 under the federal government’s economic stimulus package (Davison et al. 2012; Ruming 2014). Even when local councils are willing to address affordable housing, they lack the formal responsibility for housing assistance and resources to deliver housing programmes, in contrast to their counterparts in the UK and the USA.

Nevertheless, to the extent to which inclusionary housing models have evolved, they have largely been driven by local government (as summarised in Table 9.4). As shown, the Port Phillip Housing Association, established by the local council in that part of Victoria, has delivered approximately 560 affordable dwellings since 1985, through a combination of negotiated planning outcomes and council land and resources (Gurran et al. 2008). In Queensland, the Brisbane Housing Company, established by the Brisbane City Council, in partnership with the State Government, has a portfolio of over 700 properties, supported by planning system concessions to facilitate its developments (Davison et al. 2012).

In NSW, a number of inner city authorities, including the City of Sydney, Waverley, North Sydney and Willoughby councils have sought to secure affordable housing contributions through their local plans. A modest inclusionary zoning scheme (applying to the Pyrmont/Ultimo urban renewal and later Green Square schemes since 1996, Fig. 9.2) has not, however, been permitted to extend to other development areas. Instead, after much prevarication, the state government introduced new provisions for a range of affordable housing outcomes under the State Environmental Planning Policy (Affordable Rental Housing) 2009 (Davison et al. 2012). This policy reinforced existing provisions for

Illustration 9.2 Affordable housing (foregrounded), Green Square, Sydney. (Image credit: Sam Phibbs 2015) retaining existing low-cost stock and slowing its loss, and introduced a standard density bonus for projects incorporating affordable rental housing. The policy also encourages low-cost private sector development by making accessory dwellings (popularly called ‘granny flats’) and boarding houses (single-room occupancy dwellings) permissible in residential zones.

Other states have a shorter history of planning for affordable housing inclusion, aside from individual initiatives driven by particular local councils as outlined earlier. Queensland’s Urban Land Development Authority (ULDA) was formed in 2007 to unlock new housing supply on large residential redevelopment sites in high growth areas. The ULDA specified a minimum target of 15 % of dwellings to be affordable to low- and moderate-income households (ULDA 2009). These targets were to be achieved, in part, through adjustments to lot sizes and planning codes. However, the ULDA was disbanded in 2013, when its functions were folded into ‘Economic Development Queensland’, a commercialised







State Environmental Planning Policy 2009 Affordable Rental Housing

Levy collected to mitigate the loss of certain low-cost accommodation (used for local housing programmes)

Density bonus for projects incorporating affordable rental housing

(initiative began in mid-1980s)

Data not reported

City of Sydney inclusionary housing schemes (enabled by measures in Sydney Local Environmental Plan 2012)

Mandatory contribution requirement (between 0.1 and 3 % of residential/commercial floor area/per square metre monetary equivalent)


  • 100 dwellings (Green Square)
  • 450 (Ultimo Pyrmont)

City of Sydney/Redfern Waterloo Development Authority (now within state development organisation. Urban Growth)

Negotiated contributions (within the framework of Redfern Waterloo Affordable Housing Contribution Plan; around 3 % of residential floor area)


$32 million (Carlton United Brewery site, but used in Redfern Waterloo development area)

Canada Bay NSW

Voluntary negotiated agreement


24 units

Randwick, NSW

Mandatory contribution


15 units, (in 3 developments)

Waverley, NSW

Incentive (density bonus) Planning agreements (10 % of all agreements contribute to affordable housing fund)

28 units

Table 9.4 (continued)






North Sydney NSW

Contribution requirement (certain areas)


41 dwellings and 2 boarding houses (drawing on local contributions + other council resources)

Willoughby NSW

Contribution requirement considered (when land rezoned)


10 units (by 2008)


New residential areas.

15 % affordable housing


4016 low-cost home


residential 'upzonings'

inclusionary requirement

ownership dwellings delivered (by 2013)


New residential areas, renewal areas

20 % inclusionary requirement (new land releases including land rent)


286 affordable sites sold 2014-2015; 2643 land rent sites 2011-2015

Sources'. Gurran et al. (2008), Davison et al. (2012), Economic Development Directorate (2015) business unit of the Department of State Development, Infrastructure and Planning, leaving future affordable housing outcomes unclear.

In 2006, landmark amendments to South Australia’s Development Act 1993 enabled local plans to include provisions for affordable housing under a state affordable housing target to deliver 15 % affordable housing in new development areas (Davison et al. 2012). The planning provisions were initially applied to the redevelopment of government sites but have increasingly been included when major new residential areas are released or rezoned to allow higher-density development. In contrast to the NSW approaches which have focussed on the development of affordable rental housing for management by a social housing authority, most dwellings secured through the South Australian model are intended for sale to eligible moderate-income earners (up to 120 % of the area median). The model requires developers to demonstrate how their projects will achieve the affordable housing targets, and to release a set number of dwellings for sale to eligible households at an agreed price within a defined affordability range. As noted, the programme is supported by a government mortgage scheme which ensures that eligible households are able to access home finance. This approach has yielded a steady stream of dwellings, with around 4000 homes produced between 2006 and 2012 (Austin et al. 2013).

In the ACT, a leasehold system of land[1] has enabled the territory government to support more ambitious affordable housing targets (15—20 %) in new build and urban infill contexts. The housing has been produced through design solutions, such as smaller allotments and building diversity typologies which reduce costs. A ‘land rent’ scheme where households buy or commission a home but lease the land, is the major delivery vehicle for the affordable housing goal (ACT Planning and Land Authority 2010, Economic Development Directorate 2015).

In Western Australia, the state government announced a commitment to deliver 10,000 affordable homes by 2015. Rather than delivery through the planning system alone, a combination of levers including the use of government land, housing design and finance innovations has been pursued. The target of 10,000 affordable homes was achieved five years ahead of schedule, and the government promptly commited to another 5000 dwellings (Government of Western Australia 2012, Government of Western Australia 2015).

Thus, within Australia, there are signs of renewed commitment to affordable housing inclusion in South Australia, Western Australia and the ACT. Rhetorical commitments towards addressing affordability problems and supporting affordable housing development in the other states continue, although the extent to which ostensible concern will result in new policy action remains unclear.

  • [1] The leasehold system in the ACT dates from its establishment as the national capital and wasintended to reduce the potential for land speculation in the capital’s development.
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