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Affordable Housing SEPP 2009 Floor Space Ratio Increases and FSR Bonus

The NSW Government has made it easier and more attractive to invest in affordable housing projects with the creation of the Affordable Rental Housing State Environmental Planning Policy (SEPP) to help increase the amount and diversity of affordable housing in NSW.

This policy encourages immediate new investment in affordable housing by:

  • Providing a significant floor space bonus for projects that include affordable housing.
  • Providing an increased minimum floor space standard of 0.75:1 for affordable housing projects that are constructed over the next two years in response to weaker economic conditions.
  • Setting clear standards for developing new affordable housing projects.

One of the key incentives of the Affordable Rental Housing SEPP involves the increase of floorspace ratios for properties that provide affordable rental units. This will allow the affordable housing project ratios to have greater floor space than would normally be permitted if there is a commitment to use part of the development for affordable rental housing for at least ten years.

Q: What is floor space ratio (FSR)? The total floorspace area of a proposed building in relation to the land area it is built upon. It is the key factor used to work out how many units can be built on a site.

There are two floor space incentives available under the Policy:

  • A minimum FSR standard for low rise affordable housing projects; and
  • A FSR bonus for affordable flats in areas already zoned for flats.

Within the Sydney Metropolitan Region, these provisions only apply to developments that are accessible by public transport.

The floor space standard applies to all low-rise affordable housing developments – such as dual occupancies, villas, townhouses and residential flat buildings up to 8.5 metres in height. If the development does not exceed this FSR standard, then the consent authority cannot refuse the application on the grounds of density and scale of development.

The FSR bonus is available for residential flats containing affordable units, but only in areas already zoned for flats. The bonus is 0.5:1 (or20%, whichever is greater) on top of the existing maximum FSR allowed by the existing local planning controls. The minimum amount of affordable housing a provider must offer in order to be granted bonus floorspace is 20 percent of the total dwellings.

For full details of the Affordable Housing SEPP 2009 see http://www.planning.nsw.gov.au/affordablehousing

Rhys Donnellan, Clearpoint

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