SMHIncentives offered for developers to rent cheaply
August 1, 2009 - 3:17PM
Developers will be given the chance to build extra homes if they promise to rent at affordable levels, the NSW Government says.
Extra floor space in residential zones will be offered to those promising to rent between 20 and 50 per cent of their properties at 20 per cent below the market rate.
The scheme will work in some cases by allowing developers the chance to build more homes on individual sites than previously.
Launching the program on Saturday, NSW Premier Nathan Rees and Planning Minister Kristina Keneally told a news conference on Saturday they hoped to lower house prices by creating more homes.
But they warned that new properties built under the policy would still have to go through the full approvals process.
"Ultimately there will be much more stock at below-market rental rates in an around greater metropolitan Sydney and NSW.
"Ultimately it will mean incentives for developers to invest in apartment blocks providing they are able to provide additional capacity for lower-income households.
The scheme is designed to encourage the building of more low-rise properties, specifically near public transport and other facilities.
Under the same policy, disability groups will be given streamlined approvals for developments of up to 10 bedrooms.
The scheme was immediately criticised by Genia McCaffrey, president of the Local Government and Shires Associations of NSW, and Brad Hazzard, the opposition spokesman on infrastructure and planning.
"It's a disaster. What's the point of having planning controls if you're just going to undermine it like this," Ms McCaffrey told AAP.
"Everybody agrees we need more affordable homes but it has to be done by the government putting more money into it rather than giving developers bonuses.
"I'm sure they'll be laughing all the way to the bank."
Mr Hazzard told AAP the scheme would result in poor-quality housing.
"It's absolutely the wrong thing to do. All we'll get is cheap and nasty homes," he said.
The Property Council of Australia welcomed the move.
"This is a big policy shift which recognises the best way to get more affordable housing is to make it attractive for the private sector to build it," said NSW executive director Ken Morrison.
Urban Taskforce Australia, the national body of property developers and equity financiers, said it is a "step forward" but would only benefit those in public housing or housing associations.
"This is a niche policy which sees, at best, a small amount of additional development to accommodate some lucky renters," said chief executive Aaron Gadiel.
Speaking as a development assessment officer in local government, how are they going to make this "work?" By way of a contract prior to lodgment of DA's? Conditions of consent? Creation of or amending an existing State Environmental Planning Policy?