Following recent exhibition, the Draft Housing State Environmental Planning Policy (SEPP Housing) is now a draft instrument that must be taken into consideration when assessing development applications. This article explores some of the proposed amendments to provisions applying to boarding house development which are scheduled to come into force in October 2021.
From 31 July 2021 until 29 August 2021 the NSW Government’s Draft Housing State Environmental Planning Policy (SEPP Housing) was publicly exhibited, giving it the status of a “proposed instrument that is or has been the subject of public consultation”. Accordingly, pursuant to section 4.15(1)(a)(ii) of the Environmental Planning & Assessment Act 1979 (EPA Act), SEPP Housing is now a draft instrument that must be taken into consideration when assessing applications.
SEPP Housing proposes to consolidate the following housing-related policies into a single instrument:
- State Environmental Planning Policy (Affordable Rental Housing) 2009 (ARH SEPP);
- State Environmental Planning Policy (Housing for Seniors and People with a Disability) 2004 (Seniors SEPP);
- State Environmental Planning Policy No 70 – Affordable Housing (Revised Schemes) (SEPP 70); and
- SEPPs 21 and 36, concerning caravan parks and manufactured home estates, respectively.
In recent years, developers have taken advantage of the “bonuses” available under the existing Affordable Housing SEPP that were designed to facilitate boarding houses, including additional floor space ratio allowance and reduced requirements for solar access and parking.
Although boarding houses have been traditionally described as an affordable form of housing, there has been no requirement for boarding houses to be provided as “affordable housing” and many new generation boarding houses are rented out at premium prices.
Proposed changes
Significant changes are now proposed to policy concerning boarding houses which is expected to lead to a decline in this type of development.
Most notably, SEPP Housing will require boarding houses to be used for affordable housing (which includes rent controls), and to be managed by a registered community housing provider. Additionally, boarding houses will no longer be mandated in Zone R2 Low Density Residential, and will only be permitted in Zone R2 if they are located within an “accessible area” (for land in the Greater Sydney region).
The public consultation draft of Draft State Environmental Planning Policy (Housing) 2021released by the Department of Planning, Industry and Environment indicates that a number of new, non-discretionary development standards will also apply to boarding houses, including:
- Minimum landscaping requirements for boarding houses in Zones R2 and R4;
- Minimum lot size and setback requirements;
- Minimum separation requirements for boarding houses exceeding 3 storeys;
- Minimum solar access and area requirements for the communal living room;
- Minimum requirement for at least 20% of the total site area to be provided as communal open space;
- Minimum car parking, bicycle and motorcycle parking requirements;
- Maximum of 12 boarding rooms for boarding houses in Zone R2; and
- Minimum and maximum floor area requirements for boarding rooms.
Additionally, a bonus floor space ratio of 25% will only be available for boarding houses proposed in zones in which residential flat buildings are permitted. In all other cases boarding houses will be required to comply with the maximum floor space ratio that applies to residential accommodation on the land under a local environmental plan.
Status of SEPP Housing
Pursuant to pursuant to section 4.15(1)(a)(ii) of the EPA Act, councils are now required to take into consideration the abovementioned draft provisions of SEPP Housing when assessing development applications for boarding houses.
Although the draft provisions are not currently binding obligations, it is relevant to consider whether a boarding house currently under assessment will be consistent with the draft provisions.
The weight to be given to a “proposed instrument that is or has been the subject of public consultation” depends in part on the certainty and imminency of the proposed instrument. The Department of Planning, Industry and Environment website indicates that SEPP Housing is intended to be finalised in October 2021, which suggests the amendments are both certain and imminent.
Whilst SEPP Housing remains a proposed instrument, councils will need to consider how much weight, if any, should be given to a draft provision of the SEPP and whether or not it is appropriate to apply such a provision.
Once SEPP Housing comes into force it will apply to all new development applications lodged after its enactment. However, development applications under assessment are likely to be saved from its application in circumstances where the public consultation draft contains the following proposed provision:
“2 General savings provision
The former provisions of a repealed instrument continue to apply to the following—
(a) a development application made, but not yet determined, on or before the repeal day,
(b) a development consent granted on or before the repeal day.”
For all development applications saved from the application of SEPP Housing, the SEPP will continue to be given the weight of a proposed instrument not yet in force. That is to say, SEPP Housing will continue to be a relevant consideration pursuant to section 4.15(1)(a)(ii) of the EPA Act, but the provisions of SEPP Housing will not apply to those development applications saved.
Package of accompanying amendments
The package of amendments accompanying SEPP Housing includes amendments to the Standard Instrument pursuant to the draft Standard Instrument (Local Environmental Plans) Amendment (Miscellaneous) Order 2021. The Standard Instrument amendments include omitting “Boarding Houses” from item 3 (development permitted with consent) in the Land Use Table, and inserting the following new definition of boarding house in the Dictionary:
“boarding house means a building that—
(a) provides residents with a principal place of residence for at least 3 months, and
(b) has shared facilities, such as a communal living room, bathroom, kitchen or laundry, and
(c) has rooms, some or all of which may have private kitchen and bathroom facilities, and
(d) is used to provide affordable housing, but does not include backpackers’ accommodation, co-living housing, a group home, hotel or motel accommodation, seniors housing or a serviced apartment
Consequential amendments are also proposed to be made to the Environmental Planning and Assessment Regulation 2000 pursuant to the Draft Environmental Planning and Assessment Amendment (Housing) Regulation 2021, including:
- Requiring the name of the registered community housing provider who will be managing the boarding house to be included in the development application;
- Requiring a copy of the plan of management for a boarding house to be included in the development application;
- To enable a monetary contribution for affordable housing to be paid by electronic transfer into an account nominated by the relevant consent authority; and
- To prescribe conditions of a development consent involving boarding houses, including requiring a public positive covenant be registered on the title pursuant to section 88E of the Conveyancing Act 1919.
Conclusion
The new boarding house provisions proposed to be introduced under SEPP Housing are sure to change the way boarding houses are approached and designed by developers moving forward.
Given the extensive nature of amendments proposed to be introduced, councils should familiarise themselves with the draft provisions as best possible so that they are in a position to appropriately apply the new requirements once they come into force.
Should your council require any assistance in understanding the proposed amendments and how they will apply, please don’t hesitate to contact Adam Seton at aseton@marsdens.net.au or Jisella Corradini-Bird at jcorradini-bird@marsdens.net.au.
The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.
