There are multiple tools available to local government to provide affordable housing but not all provide a maximum return on investment, socially or financially.
In a discussion with Waverley and Randwick Council, Professor Peiser examined existing programs, challenges and opportunities facing local government areas (LGAs) across Sydney’s eastern beaches and shared his insights of best practices from the United States.
With the highest population density of any district in Australia and housing prices and rents significantly above the Sydney average, Waverley Council faces some challenges addressing affordable housing.
To deliver on the Council’s strong commitment to support key workers
three potential approaches to deliver affordable housing were explored:
State Environmental Planning Policy no. 70 (SEPP 70). This provides a floor space bonus where a minimum percentage of the proposed building is dedicated to affordable housing for ten years.
Voluntary Planning Agreements (VPAs). Developers can provide dedicated affordable housing units or a monetary contribution for public benefits related to the development.
Greater Sydney Commission Draft District Plans. These plans mandate floor space be dedicated to affordable housing where there is an uplift in value as a result of increased floor space or height.
Alan Bright, Manager Strategic Planning at Randwick City Council cautioned that while VPAs can produce successful outcomes they are often inequitable because they can lead to inequities. By nature, they are voluntary and applied on a site-by-site basis.
Randwick Council has used SEPP70 in their Kensington to Kingsford Town Centre project, such that council has placed a condition of consent on the development approvals that require affordable housing.
Professor Peiser’s recommendations to drive affordable housing included:
Randwick and Waverley Councils continue to provide find solutions to address both the supply and demand side of housing affordability.
A good approach on the supply side is to lower the cost of delivering housing units using government owned land offered at below market prices.
Inclusionary housing places a burden on people who are buying into an area and tends to only work in high value areas.
Integrate affordable housing and set clear standards so all have the same level of service and quality.
A level affordable units in a development of 20-25% tends to have no impact on the value of market priced units; a starting point could be set at 10-15%.
A panel discussion with John Nicolades, CEO of Bridge Housing, local developer Elia Leis, Professor Peiser and Alan Bright identified further key points:
Professor Peiser left the audience with a forceful reminder that Sydney's eastern beaches area is one of the most desirable places to live “not just in Sydney but arguably the whole world’, and that there are opportunities to leverage this demand to provide greater affordable housing.
View photos from the event here