There is currently a significant affordable housing shortfall in Victoria. Victoria’s Big Housing Build program presents new opportunities for private sector developers to work with Registered Housing Associations to deliver this much needed housing stock.
The Gadens Real Estate & Construction Team recently hosted a virtual Boardroom Briefing on the new planning priority pathways for social and affordable housing developments.
A summary of the key discussion points are set out below.
Although the terminology is often used interchangeably, the definition of ‘affordable housing’ in the Planning & Environment Act includes ‘public housing’.
When you are referring to affordable housing which is required by the Planning Scheme, the term is defined in the Planning and Environment Act:
Affordable housing means ‘housing, including social housing that is appropriate for the housing needs of very low, low and moderate income households’.
The reference to ‘social housing’ includes:
There is currently a significant affordable housing shortfall in Victoria.
Victoria’s Big Housing Build program is an unprecedented $5.3 billion investment in social and affordable housing, and will deliver over 12,000 new dwellings, including 9,300 new social housing dwellings, replacing 1,100 existing dwellings. The investment, delivered throughout metropolitan and regional Victoria, will boost total social housing supply by 10 per cent.
This funding presents new opportunities for private sector developers to work with Registered Housing Associations to deliver this much needed housing stock.
As conditions of approval, affordable housing must be offered at a discount to low to moderate income earners.
Recent approvals granted by the Minister for Planning, via the Development of Land Environment Water and Planning (DELWP), suggest that the expectation is:
The ‘cost’ of this discount is the ‘value burden’ (or public benefit) of the affordable housing contribution.
It is critical that an appropriately qualified valuer, with specific expertise in the affordable housing sector, is engaged at the outset of any project to properly quantify this value burden – so that this can in turn be captured in the development feasibility analysis.
As a starting point, it is critical that developers engage with the RHAs as early as possible.
Early discussions with the RHAs will identify their preferred location, housing stock types, target rents and fit out requirements (i.e. DDA design requirements for NDIS housing), and how much they can afford (e.g. the discount required) – based on the relevant RHA waiting list.
Failing to consult with an RHA at the outset of a project, may ultimately mean that a developer is left with affordable housing stock that they cannot sell or lease to an RHA.
New priority pathways have been introduced to the Victorian Planning Provisions, which are designed to fast-track the delivery of social and affordable housing projects in Victoria.
|CLAUSE 52.20 ‘VICTORIA’S BIG HOUSING BUILD’
Not a planning permit (to the satisfaction)
|Expected to be made available in 'mid-2021' As at August 2021 still not released.
Understand that criteria will be based on:
|Aiming for 30 days*
|Minister for Energy, Environment & Climate Change (DELWP)
|CLAUSE 53.20 ‘HOUSING FOR OR ON BEHALF OF THE DIRECTOR OF HOUSING’
Planning Permit process
Development of dwellings (incl. apartments)
|60 days 'business as usual'
It is anticipated that many of the current uncertainties will be clarified when DELWP releases the Criteria and Practice Note for housing projects funded under the Big Housing Build – ‘on behalf of the Director of Housing’.
Gadens will circulate the Clause 52.20 Eligibility Criteria as soon it is released.
Please get in touch with Andrea Towson, Brihony Boan or your usual Gadens contact with any queries.
If project specific information is required, please feel free to contact any of the panellists directly.
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Andrea Towson, Partner
Brihony Boan, Partner
Jackie Kirby, Associate Town Planner, Tract Consultants
Mia Zar, Associate Town Planner, Tract Consultants
Steph Harper, Director – Residential Investment, CBRE