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Australian cities would boost their stock of affordable housing and make better use of density bonuses offered by governments if inclusionary zoning requirements were brought in slowly and increased over time, new modelling by NSW provider St George Community Housing shows.

Developers typically oppose policies requiring the provision of affordable homes, but a gradual phase-in of such a policy, and a staged increase, like the increase over time of the superannuation guarantee, would give them certainty to accept it, St George chief executive Scott Langford said.

The proposal by St George and consultancy Astrolabe for staged policy starts with a 5 per cent requirement, introduced after preparation period of three to five years and gradual increases as economic conditions permit. There was no proposed ceiling, but global evidence showed a 15 per cent-plus target was sustainable, they said.

“What developers struggle with is uncertainty,” Mr Langford told The Australian Financial Review.

“If they can see the requirements for inclusionary zoning or infrastructure contributions or any of the other variables, they can build it into their feasibility assessments.” 

Without such a requirement, and funding from a source such as the $10 billion Housing Australia Future Fund to help community housing providers acquire the affordable units in private developments, schemes such as the NSW government’s height and density bonus announced in June would struggle to gain traction, said Astrolabe director Michael Cominos.

“Without interventions to support a CHP’s ability to pay for homes, the scheme won’t be used at scale,” Mr Cominos said.

“Either policy settings need to be amended or the level of affordable housing would have to drop to promote adoption of the scheme by market build-to-sell developers.”

This is an extract from an article written by Michael Bleby for Australian Financial Review, published on 21st September 2023. 

Read the full article below: 

Read the full story: Affordable housing mandates can work for developers, says SGCH - Australian Financial Review

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