City of Sydney proposes building changes in effort to boost housing

by DOUGAL TSAKALOS-STEWART

Proposed changes to planning rules in the City of Sydney municipality are set to encourage developers to create more build-to-rent residences, a step forward in tackling the housing crisis.

Under the proposed amendments to the Sydney Local Environment Plan 2012, developers would be given from 20 to 75 per cent more floor space for build-to-rent development in conversions and new builds, depending on the site location.

Build-to-rent apartment complexes are designed and built by a developer who, instead of selling the units, retains ownership of the building when its complete and rents them to tenant households.

Developers will also be able to access more floor space for co-living accomodation, which would boost student and low-income worker accomodation near major tertiary institutions.

Lord Mayor of Sydney Clover Moore said, “Students are one of the groups hit hardest by the rental crisis in Sydney, with the lack of appropriate accommodation and affordability both major issues.”

“By offering these floor space incentives, we hope landowners and developers will create more co-living accommodation in areas like Haymarket, which has proved popular with students.”

The lord mayor further assured that build-to-rent accomodation has high occupancy rates, which is “great for inner-city vibrancy and avoids situations where international investors leave newly built flats empty.”

From 2018 to 2022 there was an increase of vacancy rates in Sydney dwellings from 1.9 to 2.9 per cent. Vacancy rates hit a peak of 4.3 per cent in May 2020, with 29,416 dwellings being vacant at that time.

City of Sydney Council has previously fought against the high number of dwellings left vacant during a housing crisis.

A motion previously put forward by Greens Councillor Sylvie Ellsmore highlighted an alarming amount of empty housing. Using electricity data to determine houses that go for extended periods without use, research by the Australian Bureau of Statistics (ABS), released on 29 August 2023, found that there are 2,568 dwellings not in use in the City of Sydney, making up 3.1 per cent of the total dwellings.

Build-to-rent is part of the solution to vacant dwellings and the rental crisis, with the lord mayor assuring that this type of housing “does not sit idle with lights out, as some high-end investor apartments do” and that “these developments will help revitalise and boost the local economy.”

Affordable housing types like build-to-rent have been overwhelmingly successful in other countries, providing stable and secure accommodation for renters, she continued.

Sweden, for example, has a particularly strong build-to-rent market – in 2019, volumes rose by over 40 per cent. In Germany, almost 50 per cent of the total housing market is private rental accomodation.

The proposed amendments to the Sydney Local Environment Plan 2012 will be placed on exhibition and open for public comment until May 14.