Supporting affordable housing supply: inclusionary planning in new and renewing communities

Inquiry into increasing affordable housing supply: evidence-based principles and strategies for Australian policy and practice
Housing Housing development Low income housing Social inclusion Planning Housing density Inclusionary zoning Land use Affordable housing South Australia New South Wales California United Kingdom
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This study examined how land use planning mechanisms can support affordable housing inclusion within new and renewing communities.

It found that 'inclusionary planning' tools leverage significant quantities of affordable housing supply in many parts of the UK and US. For instance, 12,866 affordable housing units (43% of total affordable housing output) were delivered through inclusionary planning requirements in England between 2015–16. About 12 per cent of annual housing completions in San Francisco are affordable dwellings produced through inclusionary zoning or impact fee requirements. Similar schemes apply to more than 500 cities across the United States.

In comparison to this international practice, inclusionary planning for affordable housing is not as widespread in Australia. However, South Australia delivered 5,485 affordable homes between 2005–15 through an inclusionary planning target applying to new residential areas. This amounts to around 17 per cent of total housing supply in that state.

In NSW, a planning incentive scheme introduced in 2009 has yielded around 2,000 affordable rental dwellings in Sydney, equivalent to about 1 per cent of the city’s total supply.

Across all jurisdictions examined, planning system tools can support affordable housing supply, but additional funding or subsidy is usually required to produce homes affordable to those on low and very low-incomes.

Planning system tools for affordable housing supply work best when part of a wider whole-of-government strategy to address the continuum of housing needs.

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