The first in a series of papers focused on the housing crisis in Australia. It finds the current debate too often overlooks the significant opportunity presented by medium-density housing. The report proposes that reforms that allow modest increases to housing density could add close to one million new homes across Australia's five largest cities. 

High-density infill and low density fringe development alone cannot provide enough homes to meet demand and aren’t always the right outcome. Embracing the middle ground of 'gentle density' in well-located and serviced middle-ring areas is key to increasing Australia’s housing supply. Types of gentle density include terrace housing, townhouses, low-rise apartments and dual occupancy.

The report looks at the lessons of planning reform in Auckland, New Zealand. Compared with what would have occurred without the reforms, there was an estimated 50% increase in building consents within five years of their introduction in 2016, with house prices estimated to be 15% to 27% lower than would otherwise have been the case.

Key findings

• Approximately 70% of homes are standalone dwellings.
• Australia needs to build 240,000 homes every year to meet the target of 1.2 million homes by 2029.
• If one-in-four standalone homes in Sydney, Melbourne, Brisbane, Adelaide and Perth were developed into dual occupancies, it would increase housing supply by 9%.

Key recommendations

• Increase the number of dwellings allowed per hectare across large areas such as entire local government areas.
• Introduce 'by-right' planning rules that specify what can be built without objection, based on land size.
• State governments should offer financial incentives to councils that meet housing targets, while penalising those that don't.
• The federal government should set clear criteria for planning reforms and reward state governments that deliver
• Continue to pursue planning policies aimed at speeding up housing delivery, such as Transport Oriented Development and infill housing.