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Home Civil Construction Urban Development

LGNSW responds to new state housing policy

by Sarah MacNamara
February 26, 2025
in Community, Council, News, NSW, People, Planning, Policy, Project, Urban Development
Reading Time: 4 mins read
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Image: Samar/stock.adobe.com

Image: Samar/stock.adobe.com

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Local Government NSW (LGNSW) has responded to the New South Wales Government’s new low- and mid-rise housing policy, emphasising the importance of ongoing collaboration and transparent partnership. 

The State Government said the plan will deliver 112,000 homes across New South Wales over the next five years as the next stage of the policy comes into effect. 

The new reforms change planning controls within 800m, or ten-minute walk, around 171 town centres and stations to allow dual-occupancies, terraces, townhouses and residential flat buildings across metropolitan Sydney, the Central Coast, Illawarra-Shoalhaven and Hunter regions. 

The policy aims to reintroduce housing choice and diversity back into communities, filling the ‘missing middle’ between high-rise apartments and greenfield development. 

The New South Wales Government said currently, only two of 33 councils in Greater Sydney allow terraces and townhouses in low-density (R2) zones, and residential flat buildings are prohibited in 60 per cent of all medium-density (R3) zones. 

The reforms will remove the restriction on developing terraces, townhouses and low-rise residential flat buildings on R1 and R2 zoned land, while also removing the restriction on delivering medium-rise residential flat buildings on R3 and R4 zoned land in these areas. 

These changes still allow councils to assess important development conditions including parking, light access and minimum frontages. 

The State Government said allowing these housing types to be permissible again will boost housing supply around transport and town centres, improve affordability, maintain the character of an area and build better communities. 

LGNSW response 

LGNSW welcomed some elements of the new policy and emphasised the importance of collaboration with local government. 

LGNSW President Mayor, Cr Phyllis Miller OAM, indicated that, while each council would have views on specific sites, continued collaboration and transparent partnership with State Government was needed if the policy was going to succeed. 

“We’re glad to see the changes outlined by the Minister will still allow councils to assess important development conditions including parking, light access and minimum frontages, but it’s important to note that will be set against new ‘non-refusal’ standards that are being imposed on us by the State,” Cr Miller said.  

“When I met with the Planning Minister earlier this week, I made it very clear to him that together we can achieve much better outcomes if the State Government continues to work with councils when it comes to delivering housing solutions. 

“The State Government insists that allowing these housing types will boost housing supply around transport and town centres, improve affordability, maintain the character of an area and build better communities. 

“But that will only happen if the increase in density is matched with proper and significant infrastructure support from the State Government – we’re talking about schools, libraries, sports fields and playgrounds, adequate hospitals, even the basics of road infrastructure and sewerage and water supply.” 

Cr Miller said she appreciated that the State Government had responded to councils’ concerns about applying the policy to land that was prone to bushfires and floods, and had listened to feedback for areas where greater density would lead to unacceptable traffic and congestion impacts. 

However, she expressed disappointment that there was no inclusion of affordable housing mandates in the policy. 

“The absence of any contribution for in-perpetuity affordable housing is a significant missed opportunity to address this dire need, particularly for workers who carry out essential jobs in our communities,” Cr Miller said. 

“These key elements of much-needed infrastructure and affordable housing mandates need to be in place from the very start so developers can factor that into the cost of land. 

“Councils are at the forefront of our communities – we know what opportunities there are, but we also know too well the obstacles that are holding us back. Local government – as always – stands ready to work alongside the state to help address this very real housing crisis.” 

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