Under a new plan put forward by Mosman Council, affordable housing in the LGA will last in perpetuity, be built identical to regular units and will be charged at no more than 30 percent of the tenants income.
What happened: Last Wednesday, Mosman Council put forward two major policy documents that would dictate future development across the LGA.
The first was the Mosman Masterplan, proposing a rezoning of land along Military and Spit Road for increased housing.
The second is more complicated, setting out how affordable housing will be provided as part of these developments. So, what would it change?
Topline: In NSW, developers can gain bonuses to the height and size of their projects if they designate 10 percent of their units as “affordable housing”. Mosman’s alternative plan reduces this amount to 2 and 3 percent for different parts of the LGA.
It also allows developers to make monetary contributions, with which council purchases its own affordable housing stock.
Why: In essence, Mosman’s alternative policy reduces the overall amount of affordable housing provided, but increases the quality of what is provided. This means:
Housing remains at discounted “affordable” price in perpetuity, not just for 10 or 15 years
Housing designated as affordable must be identical to market-rate housing (in response to developments where the entrance to affordable units is kept separate to market-rate units, dubbed a “poor-door”).
The discount on this housing is calculated proportionately to the income of the occupant
While the state plan could provide more overall affordable units, given the high price of rents in Mosman, few of these would realistically be affordable.
Under Mosman’s new plan, rents on affordable units would be charged at around 30 percent of a tenants income.
Why is that important? Affordable housing in New South Wales works in two ways. The rent can either be calculated as around 25–30 percent of a tenant's income, or as a 20-25 percent discount to market rate rent. Developer-led affordable housing units typically opt for the latter.
In areas where rent is high — such as Mosman — even if a unit is provided at a 25 percent discount, this can still be unaffordable for low to middle income earners.
Sue Weatherley, the NSW President of the Planning Institute of Australia, told the Lorikeet the plan was “a reasonable response to the needs of the Mosman community”.
Will it go ahead? While the Department of Planning does hold the power to reject this scheme, Mosman Council is doing what has been asked of it.
In August, the NSW government published its “Sydney Plan”, setting out how Sydney’s population growth will be managed over the next 20 years. Part of this plan requires all local councils to make their own affordable housing schemes by 2029.
Weatherley said the purpose of these plans is to tailor the state's affordable housing policy to deliver practical results at the local level. Similar plans are in place across Western Sydney and in Ku-ring-gai.
She said it was unlikely Mosman’s plan would disincentivise development more broadly, claiming two to three percent is a “reasonable level [for contributions] to be set at”.