Draft Western Sydney Regional Affordable Rental Housing Contribution Scheme

Hawkesbury City Council is one of five Western Sydney councils exhibiting a regional draft affordable rental housing contribution scheme and distribution plan for public comment. The preparation of a draft affordable housing contribution scheme by Councils is required by the NSW Department of Planning, Housing and Infrastructure (DPHI).

Council resolved to exhibit the draft scheme at its meeting on 30 January 2024.

Housing affordability is a growing problem for Western Sydney households. In the past, Western Sydney was among the more affordable regions in Greater Sydney, however house and unit rental prices have risen sharply in recent years, widening the gap between the cost of housing, and what people can afford to pay. This has left many people, including full-time workers, struggling to meet their rental payments. There is an increasing number of people in Western Sydney experiencing homelessness, sleeping in cars, or staying in unstable accommodation.

As one of the fastest growing regions in Australia and the location of Sydney’s new international airport, the current high demand for affordable housing will continue. Councils in Western Sydney are concerned about the impact this crisis is having on local communities. One way they can assist is to develop a scheme that enables the collection of monetary contributions from some new development, which will help pay for new, affordable rental housing.

What is being proposed and when would it apply?

The draft Scheme proposes a low monetary contribution from some new development- to be introduced from March 2028 onwards. This lead-in time of three years is to ensure the draft Scheme does not impact the current supply of new housing. It also provides notice to the development industry and community and allows time for developers to factor the contribution into future land purchases and development costing.

These modest contributions would be used to provide affordable rental housing, made available at rents that very low-, low- and moderate-income households can afford. The housing will be for local households including essential workers, families, seniors and others who are not able to afford the high price of private rentals.

When used alongside Commonwealth Government funding, the contributions will directly fund an estimated 3,600 permanent affordable rental housing dwellings for residents of the five Council areas over the first 10 years of the scheme.

The draft scheme is accompanied by a Distribution Plan. The draft Distribution Plan sets out details for how the contributions from the scheme would be used to commission and manage the affordable rental housing in the long-term.

The five Councils working together on the draft Scheme and participating in this exhibition are: Blue Mountains City Council, Blacktown City Council, Hawkesbury City Council, Camden Council and Wollondilly Shire Council.

How will the contribution be levied?

The draft Scheme would permit Council to levy a contribution for the purposes of affordable housing on certain types of new development approved after March 2028.

The draft scheme is proposed to apply to all land within the five Council areas and would be implemented via an amendment to the Local Environmental Plans of the five participating Councils and an amending SEPP.

The proposed residential contribution is 1.5% of floor space and will apply to new residential subdivisions at the subdivision DA stage. It will also apply to some new residential development, including residential flat buildings and shop top housing, new attached dwellings (terrace houses), new secondary dwellings and dual occupancies. It will not apply to new single houses (defined as dwelling houses) on a single lot of land, to residential alterations and additions or to replacement development that doesn’t result in additional floorspace. It also will not apply to affordable, social or seniors housing.

The proposed non-residential contribution is a discounted rate of 0.3% of floor space and would apply to large (greater than 1000 sqm) non-residential development, including industrial, retail and commercial development. It will not apply to community facilities.

The contribution will be applied as a monetary contribution and as a condition of development consent before the issue of a construction certificate. It will be calculated by multiplying 1.5% (or 0.3% for non-residential development) of the proposed floor space area against a dollar rate per square metre.

Who will the draft Scheme affect?

The draft scheme will help provide housing for a diverse range of people already living in the Council area, including essential workers, families, pensioners and others who are not able to afford the high price of private rentals. Once the scheme is in place from 2028 and construction of the housing commences, there will be an opportunity for local people who meet set criteria to apply to rent the homes built.

The draft scheme is designed to have no impact on existing homeowners or new home buyers, as development applications (DAs) for new single dwelling houses and renovations (alterations and additions) are exempt from payment. Developers and landowners will pay contributions when subdividing land for new dwellings, and for multi-unit dwellings, secondary dwellings and dual occupancies. Large commercial, retail and industrial DAs will be required to make a small contribution, but businesses proposing developments under 1000 sqm will be exempt. This will help to ensure industry contributes to housing needs in the region, but with little to no impact on small business.

Public Exhibition

The draft Western Sydney Regional Affordable Rental Housing Contribution Scheme and accompanying draft Distribution Plan are on public exhibition from 10 March until 7 April 2025.

You can make a written submission before the close of business on 7 April to Hawkesbury City Council, PO Box 146, Windsor NSW 2756 or to Council@hawkesbury.nsw.gov.au. Please quote Reference Draft Western Sydney Regional Affordable Rental Housing Contribution Scheme.

For any questions please contact Sunehla Bala, Coordinator Strategic Land Use Planning on 02 4560 4544.

Supporting documents
For more information regarding the draft Scheme and draft Distribution Plan, please refer to the documents at the top right of this page.

Frequently Asked Question
Please refer to attached Summary & FAQs document.

Enquiries
For further enquiries please contact Sunehla Bala via phone 02 4560 4544. or email council@hawkesbury.nsw.gov.au