In-fill affordable housing

In-fill affordable housing provides opportunities for the delivery of new affordable housing in well-located areas to meet the needs of a wide range of households on very low to moderate incomes.

The in-fill affordable housing provisions were transferred from State Environmental Planning Policy (Affordable Rental Housing) 2009 to the Housing SEPP when it was made in November 2021.

On 14 December 2023 the NSW Government implemented in-fill affordable housing reforms to encourage private developers to boost affordable housing and deliver more market housing. The reforms include:

• A floor space ratio (FSR) bonus of 20–30% and a height bonus of 20–30% for projects that include at least 10-15% of gross floor area (GFA) as affordable housing. The height bonus only applies to residential flat building and shop-top housing. The FSR and height bonuses are proportional to the affordable housing component.
• The former in-fill affordable housing bonuses are still available for development by Land and Housing Corporation (LAHC), the Aboriginal Housing Office (AHO), Landcom and registered Community Housing Providers (CHPs) on land with a maximum permissible FSR of 2:1 or less. These agencies and CHPs are now able to apply the more generous of the two formulae for calculating the FSR bonus under sections 16 or 17 of the Housing SEPP.
• The accessible area definition has been amended to increase the walking distance from a light rail station from 400 m to 800 m and include metro stations.

The in-fill affordable housing provisions:

• apply to land in:
  • the Greater Sydney, Lower Hunter, Central Coast and Illawarra-Shoalhaven regions (with the exception of the Shoalhaven LGA and the Port Stephens LGA) within an accessible area
  • other areas within 800 m walking distance of land zoned E1 Local Centre, MU1 Mixed Use, B1 Neighbourhood Centre, B2 Local Centre or B4 Mixed Use.
• require a minimum of 10% of the development to be used for affordable housing, with the provisions encouraging the delivery of 15%
• include built form bonuses to encourage the development of affordable housing
• requires the affordable housing portion of the development to remain affordable and be managed by a registered community housing provider for a minimum of 15 years
• include non-discretionary development standards for lot size, dwelling sizes, deep soil zones, car parking and others
• require the consent authority to consider the character of the local area or the desired future character for areas under transition.

The NSW Government amended the State Environmental Planning Policy (Planning Systems) 2021 on 2 August 2024 to temporarily expand the pathway for in-fill affordable housing state significant development (SSD). The expanded pathway relates to an application for alterations and additions to an existing development. It enables the estimated development costs for the existing consent and the new works to be combined for the purposes of meeting the SSD threshold. The temporary in-fill affordable housing SSD category will operate for 12 months and be limited to projects where the original consent has been issued after 14 December 2021. The following qualifications apply:

• The combined EDC amount is to relate to the residential component only.
• A dwelling number threshold to access this policy is set at a minimum 40 additional dwellings in the Sydney region and minimum 20 additional dwellings on other land.
• The development application does not involve development that is prohibited under another environmental planning instrument.

Faster SSD Assessments for Affordable Housing

To support the delivery of SSD affordable housing, the department will work with applicants to speed up assessments and will target an average time of 275 days from lodgement to determination (or referral to the Independent Planning Commission or Minister for Planning).

Faster SSD assessments will be supported by a dedicated housing assessment team, industry-specific SEARs and a mandatory scoping meeting.

We have updated the Guide to Faster SSD Assessments for Affordable Housing to reflect changes to policy and practice.

The changes include:

• clarifying which SSD applications are subject to the 275-day target, including adding applications lodged by certain public authorities under schedule 1, section 26 of the Planning Systems SEPP
• a dedicated housing assessment team to support a more streamlined and consistent process for applicants
• refining expectations for applicant response times
• confirming that State Design Review Panel requirements can be waived, where appropriate
• 2-year consents for approved affordable housing SSD applications.

Applicants can find out more in the following documents:

• Guide to Faster SSD Assessment for Affordable Housing (PDF, 426 KB)
• Scoping meeting requirements for applicants (PDF, 100 KB)