You may be wondering how a national housing scheme centred around building more new homes could make your existing property substantially more valuable. Let me explain. 

The National Housing Accord is a federal initiative designed to address Australia’s housing shortage. The aim is to build 1.2 million homes in good locations over five years (between FY24 and FY29). 

All levels of government are involved in making this happen by streamlining local council planning approvals, increasing construction capacity, attracting private sector investment, and other things. 

Each state and territory is implementing their Accord commitments in their own way. 

So, what does this mean for you? 

I’m going to use what’s happening in NSW as a case study to explain it. 

Essentially, for homeowners in NSW, your property may be worth more right now because of two stages of zoning changes that have already been implemented over the past nine months. 

These changes have come in under the NSW Government’s Low and Mid-Rise Housing Policy, which aims to fill in the ‘missing middle’ in the housing market. That is, the gap in supply between freestanding houses (which are expensive) and high rise apartments (which doesn’t necessarily appeal to everyone). 

There are plenty of people, including downsizers and younger couples without children, who would ideally like to live in smaller (and more affordable) properties, like a townhouse, duplex or semi, in established suburbs close to work and friends. But these types of properties can be hard to find.

The policy seeks to address this by encouraging the development of dual occupancies (that’s two homes on a single block), terraces, townhouses, low-rise apartments (one to two storeys) and mid-rise apartments (three to six storeys) in areas within walking distance of shops and public transport. 

The first stage of the Low and Mid-Rise Housing Policy began on July 1 last year. 

Stage one allows dual occupancies and semis to be built on blocks in R2 low-density residential zones. Previously, many councils restricted dual occupancies in R2 zones, meaning only single houses could be built. Now, all R2-zoned land allows for two dwellings on a single lot.

You’ll need to do your research to find out if your property is in an R2 zone and meets other criteria for development. If it does, then congratulations – your home has just become a lot more valuable. 

Owning developable land provides an immediate uplift in value regardless of whether you develop your property or not. 

This is how the National Housing Accord is making thousands of existing homes more valuable. 

Not only that, but it’s also giving owners future options. For example, couples could downsize ‘in place’ by redeveloping their family home into two downsizer homes. Live in one and sell or lease the second home out. You can stay in the location you love but change the size of home you live in. 

Dual occupancies are also a great option for multi-generational living, which is a growing trend in Australia. Under these changes, multi-gen families could buy a developable property and build two homes that meet their needs. As more dual occupancies are built, multi-gen families will eventually have more opportunity to buy brand new homes rather than having to build themselves. 

The second stage of the Low and Mid-Rise Housing Policy became effective just a few weeks ago. 

It allows for the development of dual occupancies, terraces, townhouses, and apartment blocks within 800 metres of town centres, train or metro stations, and light rail stations. 

Stage two is now in effect in 171 areas across Greater Sydney, the Central Coast, Lower Hunter and Newcastle, and Illawarra-Shoalhaven and overrides previously existing council regulations. 

Again, you need to do your research to find out if your property has become developable under stage two. 

The best part of these zoning changes is you do not need to develop your property yourself in order to capture the new value. 

You only need to ensure that if you sell, you choose an agent who is well-informed and knows how to market your home not only to owner occupiers who may like it as it is, but also small developers and other buyers willing to rebuild. 

If your home has been impacted by these changes and you’d like to know how much more it is worth today, call in an experienced local agent to do an appraisal. You may be very pleasantly surprised. 

By John McGrath, Chief Executive Officer of McGrath Estate Agents. 

For more information including articles, checklists, guides and more visit McGrath’s Insights Centre.

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