Out of character: delivering affordable rental housing in NSW

Planning & Environment eBulletin - 12 July 2012

Summary

The "local character" test was introduced to the State Environmental Planning Policy (Affordable Rental Housing) 2009 (ARH SEPP) via amendments made on 20 May 2011 (2011 Amendments). 

The test applies to development applications for infill affordable rental housing development and boarding houses and requires that a consent authority consider whether such developments are compatible with the character of the local area before granting consent.

In this e-bulletin we look at a number of recent decisions by the Land & Environment Court (Court), where it has considered the "local character" test, and discuss ways in which affordable rental housing developments can meet this test.

 

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Background

The ARH SEPP was first introduced in July 2009 with the aim of increasing the supply and diversity of rental and social housing in New South Wales. 

Prior to the 2011 Amendments, development for the purposes of dual occupancies, multi-dwelling housing and residential flat buildings could be carried out in certain residential zones – even if it was normally prohibited – provided that 50% or more of dwellings in the development were for affordable housing, and that the development was less than 8.5 metres high.

The 2011 Amendments introduced several changes in relation to in-fill affordable housing and boarding houses, including that:

  1. dual occupancies, multi-dwelling housing and residential flat developments are no longer automatically permitted in certain residential areas by virtue of the ARH SEPP; and
  2. where such development is permissible within the relevant zone:
    1. a consent authority must consider whether the proposal is compatible with the local character of the area (the "local character " test); and 
    2. at least 20% of total floor space, rather than a proportionate number of units, must be used as affordable rental housing (for 10 years).

The "local character " test also applies to boarding houses.

The 2011 Amendments have effectively tightened planning controls around the provision of infill affordable housing. In addition, the "local character"  test involves a subjective assessment by the consent authority as to whether a proposed development would be in harmony with the buildings around it. This requirement can therefore be difficult to satisfy, especially where there is significant local opposition to the proposed development. 

 

Meeting the "local character" test

Three recent Court decisions have upheld appeals in relation to development applications under the ARH SEPP, after consent was refused by the local council on the basis that the proposed development was not compatible with the character of the local area. 

In these decisions, the Court confirmed that its earlier consideration of compatibility with urban character in relation to a development application based on existing use rights1 also applies to the "local character" test in the ARH SEPP. 

According to the Court, there are two questions to be considered in determining whether a proposal is compatible with its context:

  • Are the proposal's physical impacts on surrounding developments acceptable? 
  • Is the proposal's appearance in harmony with the buildings around it and the character of the street?

Are the proposal's physical impacts on surrounding developments acceptable? 

Physical impacts, such as noise, overlooking and overshadowing which constrain the development potential of surrounding sites will not be acceptable. Therefore, a development which would cause this kind of impact will clearly not be compatible with the local area.2 

Physical impact can be assessed with relative objectivity, whereas deciding whether or not a new building is in harmony with its surroundings is a more subjective task as considered below. 

Is the proposal's appearance in harmony with the buildings around it and the character of the street?

While this question involves an element of subjective assessment, in recent decisions the Court has found that:

  • the relationship of built form to the surrounding space created by building height, setbacks and landscaping, is significant to the creation of urban character;3 
  • in special areas, such as conservation and heritage areas, architectural style and materials also contribute to character;4 
  • the retention of trees and deep soil landscape will assist in maintaining character and improving the visual impact of buildings;5  and
  • the local area in which character should be assessed is principally the visual catchment in which the development will be viewed. However, the wider context is also relevant.6 

By way of example, the Court has allowed appeals against the refusal of development applications where:

  • a proposed development responded to the essential developments of the local area, in that it was of similar height, bulk, scale and character to the surrounding Victorian style housing and generally adopted the setbacks of adjoining buildings to the front and rear;7 
  • a proposed development would change the streetscape but would still sit comfortably within other developments in the vicinity;8  and
  • the appearance of the development was considered to be in harmony with the developing character of the street, because the local area was undergoing transition from lower density, single dwelling houses to higher density, multi-unit housing.9 

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Key points: tips for planners and developers

  • The subjective nature of the "local character" test allows a wide range of interpretation by consent authorities. Despite this, recently, the Court has displayed a willingness to allow appeals - following refusal based on compatibility with local character - and has provided some useful guidance as to how it can be shown that a proposal is compatible with the character of a local area.
  • In determining whether a proposed development is compatible with the character of the local area, the Court will compare building height, bulk, scale, setbacks and landscaping to existing developments. 
  • It is important to note that developments which limit the development potential of surrounding sites will not be compatible with the character of a local area, so issues such as overshadowing, overlooking and noise must be considered when designing affordable rental housing developments.
  • Addressing these issues when preparing a development application for an affordable rental housing development may help you to demonstrate that your proposal is compatible with the character of the local area. 

 

Authors

Natalie Rodwell | Lawyer, Property Projects & Infrastructure
Breellen Warry | Senior Associate, Property, Projects & Infrastructure
Alice Spizzo | Partner, Property, Projects & Infrastructure

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1  Project Venture Developments v Pittwater Council [2005] NSWLEC 191
2  Project Venture Developments v Pittwater Council [2005] NSWLEC 191
3   Pereira v The Hills Shire Council [2012] NSWLEC 1113; Revelop Projects Pty Limited v The Hills Shire Council [2012] NSWLEC 1117; Rosen v City of Sydney Council [2012] NSWLEC 1124
4  McKees Project Management Pty Ltd v Manly Council [2012] NSWLEC 1126
5  Revelop Projects Pty Limited v The Hills Shire Council [2012] NSWLEC 1117; Rosen v City of Sydney Council [2012] NSWLEC 1124
6  Peninsula Development Australia Pty Limited v Pittwater Council [2011] NSWLEC 1244
7  Rosen v City of Sydney Council [2012] NSWLEC 1124
8  Revelop Projects Pty Limited v The Hills Shire Council [2012] NSWLEC 1117 
9  Pereira v The Hills Shire Council [2012] NSWLEC 1113

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