Significant housing reform throughout Sydney’s East and Lower North Shore is set to transform the property market, opening up greater opportunities for residential development to alleviate the housing crisis.

The introduction by the NSW Government of an amendment to the State Environmental Planning Policy (Housing) 2021 in July allows development applications for dual occupancies and semi-detached dwellings to be submitted in more R2 residential zones.

Other low- and mid-rise housing reforms will commence later in 2024, and will include townhouses, terraces and two storey apartment blocks near transport hubs and town centres in R2 low density residential zones across Greater Sydney, the Hunter, Central Coast and Illawarra regions.

They will also include mid-rise apartment blocks near transport hubs and town centres in R3 medium density zones across these regions.

These changes have already prompted major activity throughout Sydney’s premium suburbs, creating the ability to free up housing stock in areas that are largely undersupplied, according to Colliers National Director, Guillaume Volz. 

“The proposed low-to-mid-rise planning controls are already proving to be a very effective policy as they open up areas that have compliant zonings but haven’t had the appropriate controls to make feasible. Even ahead of the policy introduction, areas such as Mosman, Cremorne and Double Bay that are typified with strong end product demand have seen land owners recognise the opportunity to band together and offer their properties for sale to developers.” Mr Volz said.

“We’ve always had extraordinary interest from developers that want to participate in those areas, however activating that interest has been difficult and local controls have never permitted enough development oportunities. The proposed changes now offer more oportunities and scale for significant investment in local communities. These will further enhance vibrant centres and create new ones, adding appeal to the the target market of these areas.” Mr Ephron added.

The success of the policy is partly driven by economics, with the planning uplift providing homeowners the ability to amalgamate with their neighbours and derive in some circumstances  between 75 per cent to 100 per cent value uplift compared to the current ‘as is’ value of their properties. 

“The reality is that if you don’t provide significant economic uplift, land owners simply don’t have the motivation to amalgamate and sell together. The Government’s policy provides the incentive and you’ll now see the signifcant uplift in housing that’s desperately needed.” Mr Volz said.

Colliers has recently listed a number of prominent amalgamated sites throughout Sydney’s East and Lower North Shore, including 6-12 Henrietta Street & 7 Brooklyn Lane in Double Bay, as well as 5-17 Bond Street in Mosman. Further properties in Cremorne and Mosman are due to come to market in the near future. 

The Double Bay listing, which offers 2,593sqm across five properties, comes with a price guide of $90 million, while the Bond Street listing provides 2,593sqm of land across seven properties and has a price guide of $75 million.    

“Notwithstanding the benefits the policy can provide, it’s been a bit polarising in local communities, but forward-thinking councils are needed to help with the ongoing housing crisis. The need for change is finally being realised, and although it’s going to increase density in these areas, that’s the future of Sydney,” Mr Volz said. 

“The important thing to remember is these buildings become local centres and attractions when they’re adopted correctly, adding vibrancy to the local community. The policy around increasing density is about creating attractive development. It needs to be well designed to fit in with the character of the area and the growing needs of its people.” Mr Ephron said.

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