Concerns missing middle housing proposal could see 'hodgepodge of unsatisfactory development'

Australia Broadcast Center

05-06-2025

Some Canberra residents have expressed concern about proposed changes to planning rules that would allow denser development in Canberra's suburbs, released by the ACT government last month to address the "missing middle" in housing supply.
But ACT government architect Catherine Townsend insists the current proposal is "democratic" and focus on helping "mums and dads" as investors as much as big property developers.
The draft Missing Middle Housing Design Guide — which is currently open for public feedback — is aimed at encouraging the construction of more "missing middle" type properties in areas currently zoned for standalone houses.
Missing middle housing refers to terraces, townhouses, duplexes and low-rise apartment buildings.
The proposed changes have been welcomed by housing affordability advocates and building and property industries, though they argue further reductions in building approval red-tape and financial incentives will be needed to see an increase in missing middle homes.
North Canberra Community Council member Simon Clarke said while he was supportive of the underlying concept of addressing the missing middle, he was concerned the proposed changes could result in a "hodgepodge of unsatisfactory development".
"Housing is a human right, but my concern is that 'missing middle' has to be more than just a slogan.
"It has to be supported by rigorous structure and guidelines so that it doesn't end up being a mishmash that we look back on in 20 years' time and think, 'Why on Earth did we let that happen?'
"I think the [building and property development] industry sees the missing middle as a chance for deregulation and almost unfettered access."
Mr Clarke said the densification in some areas of Canberra's inner north has been appropriate, but it has also put strain on street infrastructure, like parking.
"In north Watson, which is a much denser area than old Watson, there is already parking stress and people are finding it very difficult to park anywhere near where they live," he said.
"You look at the developments along Northbourne Avenue that have to exit all their traffic onto the suburban streets behind, because they're not allowed to open onto Northbourne Avenue — that has placed huge stress on those smaller streets.
"It's all very well to say, 'Oh we've got the light rail and bus service etcetera, so people won't need cars'.
"It would be lovely if it actually happened, but the reality is it won't — we are still a car-based society whether we like it or not."
The ACT government said there would still be adequate restrictions to ensure suburbs retain their character and aren't overdeveloped.
Concerns have also been raised about over-shadowing caused by increasing height limits in RZ2 or 'suburban core' streets.
"Once you leave it to the profit motive to become almost the only arbiter, you understandably end up with less than satisfactory outcomes," Mr Clarke said.
But ACT government architect Ms Townsend insists setbacks, building envelopes, and over-shadowing restrictions will reduce the impact on neighbours to developed or consolidated blocks.
"I'm happy to say that there's no change to … the rights of a neighbour on the solar access to their property," Ms Townsend said.
"So, the existing conditions around solar access to your indoor private living spaces and to your outdoor private living spaces: they remain as they are now.
"The same controls over our privacy interfacing and overlooking characteristics, they stay the same as they are — and I think that's important."
Ms Townsend said minimum parking requirements are also a "point that needs attention".
"The government is very interested in being realistic about how many cars we have on site," Ms Townsend said.
"In the past, there was a mandated minimum level for owners' cars, for visitors' cars, for a lot of car parking on site.
Ms Townsend said broadly speaking, the proposed new minimum is less than it is at the moment but will need to be taken on a case-by-case basis.
"We're really aware that some areas of the territory are already at capacity with on-street parking," she said.
"So, in those areas a development will need to be fairly self-supporting in the car parking.
"What we've got to do now is anticipate a very slow transfer to fewer vehicles, so we don't build in structures at the moment that we can't manipulate or change down the track."
As to the reality of whether it would be owner-occupiers of suburban blocks or property developers who would lead processes leading to the consolidation or merging of multiple blocks for bigger developers, Ms Townsend said it could be both.
"One of the nice things about this planning reform is that it's quite democratic in that it's equally focused towards the mums and dads as well as the professional developers," she said.
"Who has the conversations about consolidation? Certainly, start with homeowners talking to your neighbours if this is something you're interested in.
"You could choose to do a joint development, or you could sell at the same time — there are many opportunities here."
But Property Council ACT Executive Director Ashlee Berry argued those opportunities won't be fully realised without financial incentives, like a moratorium on charges for changing a crown lease which can cost tens of thousands of dollars.
"Ultimately, it means that [if] projects don't stack up — they're not feasible, you can't get finance, and you need to recover your costs somehow — you won't be able to sell it for a price that actually makes you any money.
"And so people simply won't do it because it just doesn't make good economic sense."
The ACT government has said there are no proposed changes to the lease variation charge through the missing middle reforms
Under the missing middle proposal, a crown lease that is limited to one dwelling will need to be varied to permit two or more homes.
The Lease Variation Charge (LVC) — calculated based on suburb, total approved number of dwellings and their zone — is only payable once the lease variation development application has been approved, and goes toward funding infrastructure and services.
An applicant can pay up-front or may be eligible to enter the deferred payment scheme to pay the tax later when the development is built, which supports cash flow.
"The principle of Lease Variation Charge is not the issue here, it's that it has grown exponentially over the last sort of 10 years, and we've also had other issues at play," Ms Berry said.
"Land has gone up, construction costs have gone up, and so now it's the thing that's just tipping projects from being feasible to simply not stacking up.
"I'm hoping that that government will listen, government will understand that the LVC in its current form will be a handbrake on this type of development, and that we can get some really considered change to bring about this missing middle reform that Canberra needs."
The draft Missing Middle Housing Design Guide is open for public feedback online until 22 July, and written submissions can be sent by email until 5 August.