Thursday's #housingannouncementweek release policy was to make dual-occupancy townhouses or subdivisions faster to approve, or potentially as of right.
👍🏻I happen to really like this direction, having suggested it many times to government. At least they listened to something I said!
Of potential new dwellings they are: ✅Amongst the quickest to build ✅Deliver a good space:price ratio (compared with apartments) ✅Are relatively low impact on an existing neighbourhood – in most cases being 2 storeys
It's low hanging fruit to reintroduce this policy – remember, the announcement is not actually a policy as much as it is intent to create one. But the good direction also needs a reality check as to what it will really deliver.
Firstly, limiting this to dual occupancies means the incentive is to fit as much on the block as possible, which will result in larger dwellings on average. These will be relatively good value for what their size, but they are unlikely to be "affordable" to most buyer cohorts.
You need to fit 4-6 smaller dwellings on a standard residential lot (at a minimum) to get pricepoints down sufficiently. Such denser developments will still have to run the Council planning gauntlet.
Need proof? Look at the price of recently built dual-occ townhomes in attractive middle suburbs like Bentleigh, Oakleigh or Reservoir. These tend to be priced in the $1.3-$1.8m range. It's only blocks with more units which have more affordable price points.
💰It is theoretically possible to get a new, small, low-spec dual occ in some areas at or below $900k, but in most cases it would be an underdevelopment of the site. So instead these dual-occ developments will mostly skew to a larger, higher price point.
Streamlining planning timeframes – assuming the policy is implemented by April 2025 as proposed – will marginally improve the likelihood that someone chooses to build on their land. It would also free up some Council planner capacity to assess other proposals sooner.
🤔Overall this will be an incremental supply improvement at best. It's not a solution for delivering the tens of thousands of homes needed in established areas.
The only feasible way to achieve what the State Government wants from townhouse development, at price points that bring more people into the market, and at the scale it needs, is to facillitate it efficiently on larger sites.