COMMENT: Higher density development is coming to Sydney in possibly one of the quickest turnarounds in planning policy for a long time.
Unfortunately, the desired outcomes of the policy that it will yield lower cost more affordable housing, spruiked erroneously by developers and wished for by people suffering housing stress, will almost certainly not materialise.
The New South Wales government’s “staged commencement” of the Transport Oriented Development State Environmental Planning Policy (TOD SEPP) will enable “taller and denser housing within 400 metres of 37 transport nodes across Greater Sydney”, the Planning Institute of Australia NSW said on Wednesday.
The institute said:
The measures supplement proposed low-and mid-rise changes to housing within 800 m of transport hubs and local centres. The TOD SEPP controls will apply to 18 of the 37 stations from 13 May 2024. The SEPP won’t apply immediately to precincts where councils have identified opportunities for housing capacity greater than would be permitted under the SEPP. The state government will also produce tailored planning controls for eight higher growth precincts. PIA welcomes a master plan approach.
The problem, as PIA NSW sagely put it, will be if urban renewal means demolishing older, lower cost rental housing.
That’s because standards for new housing are likely to be more expensive.
It’s not just aesthetics that will cost more but also environmental quality that yields better overall operational outcomes, if you listen to architects who say it’s becoming almost impossible to design and build the standards of apartments now expected.
We know that in house and land packages builders quickly learn to incorporate higher energy efficiency more cheaply but in multi storey apartments architects have probably got a point.
As former state planning minister Rob Stokes told an architectural forum in February last year – we need more housing but what we don’t need is more million dollar one or two bedroom apartments.
So we need more social housing and more community housing provided homes.
But affordable housing levies are woeful, likely to be a fraction of what was there before – or needed, given the incredibly modest targets built into development contributions.
PIA mentions contributions standing at 2 per cent in the new SEPP. Is that a typo? Can that be right when contributions of 10-15 per cent have long been flagged, but admittedly always opposed by developers?
But it seems what developers want, developers get.
And we need developers, so they have the upper hand, right?
For instance Meriton recently got approval for 800 units at Zetland in Sydney’s inner south despite backing away from a previous commitment to pay 3 per cent affordable housing levy, opting to pay $29 million in cash in lieu.
While the City of Sydney said the money would go to affordable housing Greens Councillor Sylvie Ellsmore, pointed out this was likely to be well into the future before coming to market and by then probably much more expensive.
PIA’s media statement was hopeful and welcoming. It said in part:
The Planning Institute of Australia NSW president Sue Weatherley MPIA (Fellow) emphasised: “PIA strongly supports increased housing and intensity and diversity in well-located growth areas.”
The TOD SEPP unlocks capacity for more development – but is not a silver bullet for cheaper housing. The SEPP is among a raft of a measures needed to shape more inclusive communities and create a better experience of higher density living.
The PIA NSW president noted that “Denser and more diverse housing must be well planned, well designed, well built and well supported by infrastructure and services. It must include lower income households.”
Because urban renewal can demolish older, lower cost rental housing, PIA supports obligations on new development to provide rental housing within reach of lower income earners. Affordable housing should be managed by Community Housing Providers in perpetuity.
PIA is pleased to see an affordable housing contribution included from the outset and advocate for a ramp up of contributions well beyond 2 per cent – alongside reforms to make it easier for local affordable housing schemes to be adopted.
[In the UK it’s 50 per cent and higher.]
“PIA emphasises the need for well-planned, Well-built density supported by infrastructure and services, including affordable housing” Sue Weatherley noted.
The TOD Programs aims to create capacity for around 185,000 new dwellings over 15 years. This aspiration would represent a sizeable portion of the NSW government’s commitment towards the National Housing Accord housing supply targets. Nevertheless, the planning system controls the location and scale of development, not speed.
“While the TOD SEPP can enable the right housing in the right place, it does not control investment demand, supply chain costs nor market factors which influence housing construction and ultimately price” noted PIA NSW president Sue Weatherley.
For planning measures to be most effective, they need to be integrated with city strategy, sequenced infrastructure priorities and local master plans for better design results.
Planning tools also need to be supported by the public delivery of social housing, increased capital and operational subsidies for affordable dwellings – and improved monitoring and accountability for affordable housing stock.
PIA NSW will continue to advocate for housing that offers a better lived experience for higher density communities. After all, that’s what the national commitment for ‘well located’ housing means.