COULD A SIMPLE CHANGE TO ZONING LAWS SOLVE CANBERRA'S HOUSING AFFORDABILITY CRISIS?
1Could a simple change to zoning laws solve Canberra's housing affordability crisis?
analysis Posted 4h ago. updated 2h ago Canberra is not quite a bustling metropolis. Yet its housing prices are what might be expected in far larger. denser cities. The median value of a house in the ACT is now above $1 million — more than in Melbourne. Rents in the bush capital are the highest of any Australian city. for both apartments and houses. The effects of this price boom on housing affordability are well known: many younger people are losing hope of owning property unless they inherit it. However. a potential solution exists — let's call it 'the New Zealand fix' — that could leave almost everyone a winner. Yet it may be too radical for most Australian communities. let alone highly planned Canberra. What happened in New Zealand? New Zealand's housing affordability crisis was worse than Australia's. and worsening at a quicker rate. So its government acted. First. it cracked down on property speculation by limiting the 'negative gearing' tax break for investors. But its next step was the really big experiment. following a successful trial in the notoriously sprawled out city of Auckland. Late last year. the government. with bipartisan backing. overrode local councils' zoning powers. To dramatically increase housing supply. every residential block was rezoned as medium density. allowing townhouses to be built. This new standard now applies in New Zealand's five biggest cities. It's too early to judge the impact on affordability but Auckland's council says the city's dwelling capacity has tripled. But is it even possible to apply similar changes in Canberra? The inverted city: big blocks in inner suburbs Canberra may be Australia's most carefully planned city. but the plans haven't always lasted the test of time. Some of its most sparsely populated suburbs — family homes on massive blocks of land — are right in the heart of the ACT. inverting the general rule that city centres should be more compact than outlying areas. The typical (median) residential block in central Canberra is just under 800 square metres — that's 66 per cent larger than in Gungahlin in Canberra's north. and 54 per cent larger than in the Molonglo Valley in Canberra's south west. This map shows almost all ACT land on which people live. The vast swathes of yellow are for low density. detached housing. Canberra has almost reached its geographic limits and the ACT government is addressing this sprawl by growing 'up not out'. mostly by adding apartments in town centres and along the light rail route. Yet this is a very slow process that doesn't seem to be putting a dent in housing affordability. The government's current five year plan. for example. allows for only 620 extra dwellings per year across the entire inner north and inner south. That's actually slower than the area's projected population growth. Mass rezoning of Canberra's central region So. how could the 'New Zealand fix' be applied to Canberra? Let's examine what might happen if zoning laws were overhauled in the city's central suburbs only (the inner north and south). Here we consider two options. Both involve changing so called RZ1 and RZ2 areas. which are for standalone houses. Option 1: rezone all blocks that are 800 squares metres or larger as RZ3. which allows two storey townhouses to be built. (Current laws use an 800sqm threshold to allow an on site tenancy. like a granny flat.) Option 2: rezone all blocks that are 700sqm or larger. (This was the threshold chosen for sites affected by loose fill 'Mr Fluffy' asbestos. which can now be split into two titles.) The first option would affect about 8.100 blocks of land in the inner suburbs. The second would affect about 11.800 blocks. Under current regulations. and using recent townhouse developments as a guide. this change would massively expand Canberra's dwelling capacity. Our estimates suggest a single adjustment like this would create a potential increase of 30.000 to 50.000 extra homes. The...
#news