Planning proposal: affordable housing review

What we’re doing

Sydney remains Australia’s least affordable city. The high cost of housing is an important economic and social issue in Sydney, particularly in the city where housing prices are among the highest in Australia.

The City’s housing strategy states an additional 11,000 affordable rental housing dwellings and almost 2,000 social housing dwellings will be required to 2036.

The planning proposal for an affordable housing review follows a review of affordable housing needs and supply across the city. The aim of the planning proposal is to increase the amount of affordable housing to contribute toward our targets.

The review provides a comprehensive and transparent framework for the application of affordable housing contributions when land is being developed. It is informed by the eastern city district plan, released by the Greater Sydney Commission, which includes targets and actions for the provision of affordable housing through the planning framework.

The planning proposal is to amend the Sydney Local Environmental Plan 2012 to:

• expand the operation of current affordable housing contribution schemes to Central Sydney and residual land
• provide a framework to identify planning proposal land, being land that will benefit from increased development capacity through a site-specific planning proposal to change the planning controls, and require a supplementary affordable housing contribution.

Affordable housing program

The draft City of Sydney affordable housing program provides the background, requirements and operational detail for various affordable housing contribution provisions in local environmental plans that operate in the City of Sydney local area.

Where is the planning proposal up to?

The planning proposal was reported to and adopted by Council in September 2018.

The City is working with the Department of Planning, Industry and Environment to draft the changes to Sydney Local Environmental Plan 2012. Further documents can be found on the department’s website.

What is affordable housing?

Housing is considered affordable where the cost of rent or paying the mortgage does not absorb more than 30% of the gross income of a very low to moderate-income household. Very low, low and moderate-income households are defined in legislation, within the income ranges published annually.

The terms affordable housing and affordable rental housing are used in the inner city to describe housing that is owned by the government or a registered community housing provider. This type of housing is rented to a mix of very low to moderate-income households for no more than 30% of household income.

Why do we need affordable housing?

The decline in housing affordability and the inability of everyday people to access affordable housing is having an increasingly detrimental impact on socio-economic diversity, which underpins the city’s rich social fabric.

The inability to access affordable housing pushes lower-income households to the city fringes. The ongoing loss of key workers living in the city is also a concern, as it is increasingly difficult for essential employment sectors to fill employment vacancies and staff shifts.

Affordable rental housing supports a diverse and well-functioning city. For people on lower incomes it provides a critical alternative to private market housing, providing some opportunity to live in the city. It also acts as a release valve to social housing, easing the pressure on demand for an already undersupplied market.

City’s existing affordable housing contribution schemes

There are currently 3 affordable housing contribution schemes operating in the City of Sydney local area, including in Ultimo and Pyrmont, Green Square and the southern employment lands. The funds collected under these schemes are transferred to community housing providers who manage affordable housing in the city.

There is a need for governments to look beyond the way things have always been done and embrace new, innovative and internationally successful approaches to deliver affordable housing in the inner city.