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NSW Department of Planning, Industry and Environment
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The housing needs of people across NSW are changing. Our reforms provide for more affordable homes, more choice of homes and create new types of homes to meet these changing needs.

 

About the Housing SEPP

The new Housing State Environmental Planning Policy (Housing SEPP) will incentivise the supply of affordable and diverse housing in the right places and for every stage of life.

 

The new Housing SEPP will ensure that the home building sector is well-placed to assist the economic recovery of NSW following the COVID-19 pandemic.

 

What does the Housing SEPP do

Makes the planning system simpler by consolidating five existing housing-related policies:

  • State Environmental Planning Policy (Affordable Rental Housing) 2009 (ARHSEPP);
  • State Environmental Planning Policy (Housing for Seniors and People with a Disability) 2004 (Seniors SEPP);
  • State Environmental Planning Policy No 70 - Affordable Housing (Revised Schemes) (SEPP 70);
  • State Environmental Planning Policy No 21 - Caravan Parks; and
  • State Environmental Planning Policy No 36 - Manufactured Home Estates.

 

Introduces two new housing types to meet changing needs:

  • Co-living housing
  • Independent living units

 

Improves the way existing types of homes are delivered including:

  • Boarding houses
  • Build-to-rent housing
  • Retention of existing affordable rental housing
  • Secondary dwellings (sometimes known as granny flats)
  • Seniors housing
  • Social housing

 

Includes the planning rules for:

  • Short-term rental accommodation

 

The following instruments were made with the Housing SEPP:

  • Environmental Planning and Assessment Amendment (Housing) Regulation 2021
  • Standard Instrument (Local Environmental Plans) Amendment (Miscellaneous) Order 2021

Frequently asked questions

General

The types of homes people need are changing. People are looking for a more affordable choice of home to suit their differing needs across all stages of life. It combines five existing policies into one policy to make the planning system simpler. It does this by:

  • bringing together five existing SEPPs which share the theme of housing into a single SEPP
  • streamlining some of the provisions from those existing SEPPs by removing duplication and clarifying differences
  • updating a number of provisions, particularly those relating to boarding houses and seniors housing
  • introducing two new housing types, co-living housing and independent living units; and
  • reducing inconsistencies between similar provisions for different housing types.

The NSW Housing Strategy: Housing 2041 is the NSW Government’s plan to meet the State’s housing needs over the next 20 years. The Housing SEPP will support delivery on this strategy by driving the development of affordable and diverse housing to meet the needs of our growing community.

Learn more about the NSW Housing Strategy 2041 and 2021-22 Action Plan.

The finalised Housing SEPP is based on extensive stakeholder consultation and engagement including:

  • Exhibition of the Explanation of Intended Effect from 29 July to 9 September 2020
  • Exhibition of the draft policy in August 2021

Submissions received in response to these exhibitions have been carefully considered during the finalisation of the Housing SEPP. Summaries of all submissions, in the form of submission reports, and the submissions received are available on the Planning Portal.

We worked closely with our stakeholders throughout the consultation process. We made a number of changes based on feedback from councils, industry and the community. Generally, these include:

  • Changes to boarding houses to ensure they are built in the right places; are affordable and provide adequate amenity to residents;
  • Improve the rules for seniors housing to make sure they are delivered close to services, and enable people to age in the communities they know and love; and
  • Updating some rules for boarding houses, co-living and build-to-rent housing such as those applying to car parking requirements, local character and locational requirements.

Amendments to specific housing types include:

Co-living housing

  • Co-living housing is permitted with consent anywhere residential flat buildings or shop top housing are permitted under another environmental planning instrument. This includes the R2 – Low Density Residential zone if the council permits residential flat buildings in that zone.
  • Greater flexibility around standards for setbacks and building separation for co-living housing.

Build-to-rent housing

  • An application for build-to-rent housing in a B3 – Commercial Core zone must now be able to satisfy a consent authority that it could be readily converted to any other land use permitted with consent in that zone.
  • Active uses will only be required at street level in business zones for any part of a build-to-rent housing development that faces a road.

Seniors housing

  • Senior housing developments allowed in the SP2 – Infrastructure and RE2 – Private Recreation zones if it adjoins any prescribed zone under the Housing SEPP.
  • Seniors independent living developments allowed in R2 – Low Density Residential zone if developed by the Land and Housing Corporation or providers that operate under the Retirement Villages Act 1999.
  • Removed the term “vertical villages” in the Housing SEPP – instead these provisions are included as bonuses for seniors housing.
  • These bonus provisions have been extended to land where shop top housing is allowed, and the B3 – Commercial Core zone.
  • The State Significant Development pathway has changed to a capital investment value of at least $30 million (or $20 million outside Greater Sydney) and must include a residential care facility.

Other

  • The definition of boarding house has been expanded from “a building” to include “a building or place”. This change brings the definition of boarding house into alignment with other land use terms and allows for boarding houses to be delivered as part of a mixed use development.
  • Residential flat buildings carried out by or on behalf of a public authority or social housing provider, or by someone with the Land and Housing Corporation, must now be used as affordable housing for a minimum of 15 years.
  • New consent conditions for all types of affordable housing. For more information see the NSW Affordable Housing Ministerial Guidelines.

The Housing SEPP introduces a new definition of affordable housing households.

You can use the links below to find:

The State Environmental Planning Policy (Educational Establishments and Child Care Facilities) 2017 will be amended to include a definition of on campus student accommodation and expand student accommodation to accommodate people associated with the education facility (i.e. not just students).

Off campus student housing developers will use the co-living housing provisions.

The provisions of a former SEPP will continue to apply to:

  • development applications and concept development applications made, but not determined, on or before the day the Housing SEPP commences, or staged development applications made subsequent to such concept development applications
  • a development consent granted on or before the day the Housing SEPP commences,
  • an environmental impact statement prepared in compliance with an environmental assessment requirement that is:
    • issued by the Planning Secretary on or before the commencement date, and
    • in force when the statement is prepared.

We will undertake a comprehensive review of the provisions relating to group homes; caravan parks and manufactured home estates.

A review of the Housing SEPP will be undertaken within 3 years of the date of commencement to ensure the new and amended provisions are functioning as intended.

Boarding houses

Boarding houses must be required to provide affordable housing in perpetuity and managed by registered community housing providers (CHPs). Registered CHPs will be required to apply the NSW Affordable Housing Ministerial Guidelines.

The new provisions will not apply retrospectively, so they will not impact boarding houses that have already been approved or built. However, the new provisions will apply where an application is lodged for major alterations or additions to an existing boarding house.

The NSW Land and Housing Corporation (LAHC) is the NSW Government agency responsible for the NSW Government’s social housing portfolio. All LAHC development must comply with LAHC’s publicly available ‘Good design for social housing’, dated September 2020 and ‘Land and Housing Corporation Dwelling Requirements’ dated September 2020.

There is a need for low-cost rental accommodation for vulnerable people. Allowing LAHC to self-assess some of their developments will cut costs and delays.

Co-living housing

Co-living housing is a new type of housing that has emerged in multiple countries around the world. Key features include:

  • Small private rooms, complemented by shared indoor and outdoor spaces which encourage residents to come together to relax and socialise,
  • Private and shared spaces that are fully furnished and ready-to-occupy, and
  • A sense of community that is often actively encouraged by a manager, who is responsible for managing shared spaces.

Co-living housing is typically built in highly connected areas, where residents have convenient access to work, study, and recreation opportunities. It often appeals to young professionals and key workers but can attract a wide variety of people from diverse demographics.

Under the Housing SEPP, co-living housing:

  • Must provide a primary place of residence for all occupants. It cannot be used for short-term tourist and visitor accommodation.
  • Will have private rooms from 12sqm (for a single person) or 16sqm (for a couple) to 25sqm in size, excluding any space which may be used to provide private kitchen or bathroom facilities.
  • May have minimum six private rooms; but it is anticipated that most co-living housing developments will have around 30 to 40 private rooms.
  • Is required to provide a certain amount of indoor and outdoor space, to be shared by all residents as spaces to relax and socialise.
  • Must provide adequate kitchen, bathroom and laundry facilities for all residents – either as private or shared facilities.
  • Must have a manager, who will be responsible for implementing the plan of management for the property. The manager will not be required to be on site at all times, but must be contactable by phone 24/7.

A density bonus of 10% will apply to co-living housing.

This will support the co-living housing industry as it transitions to these new provisions, and ensure ongoing supply of this important rental housing product. This will be particularly important as part of the State’s COVID recovery.

The ongoing need for the density bonus will be considered as part of a review of the Housing SEPP, to be completed within 3 years from the day it is made.

Boarding houses and co-living housing

Boarding houses and co-living housing will be similar in terms of their built form and operation but are designed for different needs of our community.

Boarding houses are managed by a CHP and provide homes for vulnerable people. Co-living is affordable housing aimed at helping a mix of people including young professionals and key workers.

We listened to feedback from stakeholders who told us that smaller private rooms in boarding houses and co-living homes needs to be offset by shared spaces like large communal living areas and open space.

It was important to make a clear distinction between the maximum room size standards for boarding houses and co-living; and apartments in a residential flat building.

The smaller room size for boarding houses and co-living housing is offset by the shared spaces and communal facilities to be provided in these new developments.

Both boarding houses and co-living housing are required to provide residents with a principal place of residence for a minimum of 3 months. This will:

  • ensure that these housing types are not used as short-term residential accommodation or serviced apartments;
  • reduce impacts on the local community by limiting turnover of tenants; and
  • support the development of a sense of community among residents sharing spaces within these developments.

Secondary dwellings

The optional clause 5.5, which sets out controls for maximum floor area, and distance between a principal and secondary dwelling, for secondary dwellings in a rural zone has been added to some local environmental plans.

The inclusion of clause 5.5 in certain local environmental plans responds in each case to a decision of the relevant local council.

To find out whether you are impacted by this change, check your local environmental plan to see what the relevant controls are for your area.

No. Clause 4.6(8) of the Standard Instrument LEP applies to clause 5.5 of the SILEP.

Seniors housing

The Housing SEPP prescribes zones where seniors housing is permitted with consent, and removes references to ‘land zoned primarily for urban purposes’.

The introduction of prescribed zones removes the need for Site Compatibility Certificates (SCCs). The certainty and transparency created by the prescribed zones approach allows applicants to proceed directly to the development application process, rather than seeking an initial assessment of a site compatibility for seniors housing.

Independent living units were previously referred to as ‘self-contained dwellings’ in the Seniors SEPP. This change is to align with current industry terminology. The definition remains the same.

The Housing SEPP removes the exclusion of seniors housing development from the Metropolitan Rural Area (MRA). This exclusion is no longer necessary as the Housing SEPP makes seniors housing permitted in prescribed zones rather than relying on an SCC process.

The restrictions on the occupation of seniors housing are now included as prescribed conditions of development consent at clause 98 of the Environmental Planning and Assessment Regulation 2000.

The moratorium on seniors housing in Heritage Conservation Areas (HCAs) has been extended until 1 July 2022. This extension will allow additional time for Greater Sydney Region councils to see how the new provisions are applied in their LGAs. Councils will need to provide justification for any extension to the HCA moratorium beyond 1 July 2022.

People are accessing seniors housing later in life. The provisions of the Housing SEPP reflect the time when people are most likely to start making decisions about the best home to suite their future needs. The seniors housing age now starts at 60 in line with the Superannuation Act.

The current seniors housing guidelines were prepared in 2004 and are somewhat out of date. The new up to date interim Seniors Design guideline has been prepared to support the new Housing SEPP which provides for revised provisions relating to residential development for seniors and people with a disability.

In time, the new guide will update and replace the existing Seniors Living Policy: Urban Design Guidelines for Infill. For now, the new design guidance is an interim guidance but will ultimately replace the existing guide and is likely to be incorporated into the developing Design and Place SEPP.

Until that stage, the 2021 guidelines will be publicly displayed on the Department’s planning portal as a matter for consideration. Targeted consultation will occur before these guidelines are given legislative effect.

See the new Draft Seniors Housing Guidelines 2021 (PDF, 13.2 MB)

You can also find:

The current seniors housing guidelines were prepared in 2004 and are somewhat out of date. The new up to date interim Seniors Design guideline has been prepared to support the new Housing SEPP which provides for revised provisions relating to residential development for seniors and people with a disability.

In time, the new guide will update and replace the existing Seniors Living Policy: Urban Design Guidelines for Infill. For now, the new design guidance is an interim guidance but will ultimately replace the existing guide and is likely to be incorporated into the developing Design and Place SEPP.

Until that stage, the 2021 guidelines will be publicly displayed on the Department’s planning portal as a matter for consideration. Targeted consultation will occur before these guidelines are given legislative effect.

See the new Draft Seniors Housing Guidelines 2021 (PDF, 13.2 MB)

You can also find:

SEPP 70

The provisions of SEPP 70 have been consolidated into part 2 of the Housing SEPP. The Guideline for Developing an Affordable Housing Contribution Scheme is still current and can be viewed on our website.

The department has developed the SEPP 70 Affordable Housing Viability Tool (the Tool) to assist councils in developing an affordable housing contribution scheme under the Guideline. The Tool is available here for public awareness of the factors that would be considered by councils when using the Tool to determine a viable contribution rate. This version of the Tool does not contain any information regarding land prices or development calculations and is not intended to be used for property or development speculation.

For more information, access the Tool's Frequently Asked Questions (PDF, 83 KB).

 

More information

Contact the Housing Policy team:

Page last updated: 26/11/2021