Easing Development Pathways: Limited Progress, Greater Reforms Required
The NSW Government's expanded Complying Development Certificate (CDC) planning guides and recent land releases for key development projects present significant opportunities for property developers. These initiatives aim to streamline the approval process and address the growing demand for housing across the state.
The Low and Mid-Rise Housing Policy – Stage 2, effective from February 2025, introduces new non-discretionary development standards to encourage diverse housing options, including dual occupancies, terraces, and low- to mid-rise apartments. These standards override local planning controls unless the latter are more generous, ensuring consistency and efficiency in approvals. The policy focuses on areas within 800 meters of town centers and public transport hubs, promoting well-located, accessible housing.
Additionally, the NSW Dual Occupancy Reform expands the permissibility of dual occupancies in R2 Low Density Residential zones statewide. While some exclusions apply, such as heritage or environmentally sensitive areas, the reform simplifies the process for dual occupancy developments. From July 2025, dual occupancies will also be eligible for CDC approvals, further reducing barriers for developers.
These reforms, combined with the release of surplus government land for housing, underscore the NSW Government's commitment to addressing the housing crisis. Developers can leverage these changes to maximize site potential, streamline project timelines, and contribute to the creation of diverse, sustainable communities.
The expansion of easier development pathways, like the new CDC planning guides and dual occupancy reforms, is a positive step toward addressing NSW's housing crisis. However, these measures alone are not sufficient to fully resolve the issue. The challenges extend beyond streamlined approvals—factors like land affordability, infrastructure development, community acceptance, and broader urban planning strategies need to align to create meaningful, sustainable solutions.
The problem is that on the Central Coast, at least, the expansion is limited to suburbs where multi-unit housing development is not feasible. In these areas, the resale market does not generate high enough returns to offset the cost of land and construction, making such projects financially unviable.
To truly address the housing crisis, the plan needs to be expanded to include areas where housing prices are influenced by factors such as geographical desirability, proximity to coastal areas, availability of high-quality amenities, and the appeal of vibrant, sought-after neighborhoods. By focusing on these high-demand suburbs, the development equation can shift away from the lower end of the market, allowing for more successful and sustainable multi-unit housing projects that meet both market demands and community needs.
The current land release seems to have been designed as a preliminary measure to gauge feasibility; however, the land areas released so far do not present viable opportunities. Based on current assessments, these areas lack the financial appeal needed to attract developers. It may not be difficult to expand the mapped areas and allow these rules to act as a genuine solution to the housing crisis in NSW. By broadening the scope, we could unlock the potential for more impactful and viable developments in areas that truly align with market dynamics and housing demands.
