Feedback on the Draft Affordable Housing Policy closed on Friday 3 February 2023.
Council sought feedback on whether the Draft Policy is appropriate, fair and will improve affordable housing without negatively impacting the housing industry.
Around two thirds of survey respondents supported the Draft Policy, including 35 per cent that thought it could do more/go further.
The table below summarises key themes from the community feedback and describes Council’s position and or how these were addressed in the revised Affordable Housing Policy.
Respondent comment / suggestion
Council response
The State Government is responsible for social and affordable housing, not Council.
The Victorian Government build, own, and manage public housing and provide funding to community housing agencies and set the rules on how this will be managed. The State Government also controls the planning scheme and sets policy and initiatives through the Planning and Environment Act, the State Planning Policy Framework, Plan Melbourne, and the Homes for Victorians strategy.
Under the Planning and Environment Act, Council also has a legislated responsibility to ‘facilitate the provision of affordable housing in Victoria’. The Act also states that Council is permitted to enter into voluntary section 173 agreements with developers for the provision of affordable housing.
Council should pursue a mandatory affordable housing contribution, not a voluntary contribution.
The current Victorian planning framework does not provide a planning mechanism that enables councils to require developers to provide affordable housing as a mandatory requirement. The revised Policy includes a policy statement that Council will ‘advocate for mandatory inclusionary zoning in the Victoria Planning Provisions to increase the supply of affordable housing provision being provided as part of new private developments’.
Council can withhold a planning permit on the basis that the developer has not provided social and or affordable housing.
Under the Planning and Environment Act, Council cannot lawfully require an affordable housing contribution from developers. Developers must enter into affordable housing agreements voluntarily. If a developer decides not to enter into a voluntary agreement, it will not adversely affect their chances of being issued a planning permit.
Once a section 173 agreement is signed, it becomes a legal document that binds the parties involved, including the landowner and any subsequent owners of the land. Council can then enforce the agreement if the landowner breaches its terms, for example, by not providing an affordable housing contribution.
The affordable housing contribution could be interpreted as a requirement that 6 per cent of dwellings, or an equivalent market value of 6 per cent of dwellings, is gifted as an affordable housing contribution.
Council has responded to developer concerns that this could render new development proposals commercially unviable by updating the definition of the affordable housing contribution to the following: ‘The affordable housing contribution value should be equivalent to the market discount required to provide a dwelling that complies with the Affordable Housing income ranges as defined in the Victorian Planning and Environment Act 1987’.
As a developer we would want to retain the right to potentially deliver the affordable dwellings under a Build to Rent model.
Affordable housing requires long-term management and maintenance. It is important to consider the capacity and commitment of the entity to provide ongoing support and address the needs of the tenants over time. Registered housing agencies, with their focus on affordable housing, may have a stronger commitment to long-term management than developers.
However Council acknowledges that under a build to rent model, developers may prefer to retain ownership of the dwellings. Under this model, Council will require via a section 173 agreement, developers demonstrate that they are meeting their ongoing requirement to provide affordable housing, through regular reporting to Council.
Council should offer incentives to developers to provide low cost housing in the municipality.
Council has responded to community feedback on the Draft Policy about the need for planning incentives by offering the following two approval process advantages:
Providing fast-tracked applications processes within set timeframes.
Ensuring applications are processed by experienced senior staff.
To be eligible for fast-tracking, applications would need to meet a set of prerequisites established by Council’s Planning Department.
Council should prevent properties from becoming vacant and neglected.
The Victorian Government’s Vacant Residential Property Tax (VRLT) was introduced in 2018 to deter vacancies in selected inner Melbourne suburbs (including Whitehorse). The tax relies on voluntary self-reporting and to improve compliance, the revised Affordable Housing Policy includes a clause that Council will ‘advocate for a review of the Victorian Government’s Vacant Residential Property Tax to encourage greater conversion of vacant private accommodation into affordable housing rentals.’
A revised Affordable Housing Policy was adopted by Council on 10 July 2023.
Feedback on the Draft Affordable Housing Policy closed on Friday 3 February 2023.
Council sought feedback on whether the Draft Policy is appropriate, fair and will improve affordable housing without negatively impacting the housing industry.
Around two thirds of survey respondents supported the Draft Policy, including 35 per cent that thought it could do more/go further.
The table below summarises key themes from the community feedback and describes Council’s position and or how these were addressed in the revised Affordable Housing Policy.
Respondent comment / suggestion
Council response
The State Government is responsible for social and affordable housing, not Council.
The Victorian Government build, own, and manage public housing and provide funding to community housing agencies and set the rules on how this will be managed. The State Government also controls the planning scheme and sets policy and initiatives through the Planning and Environment Act, the State Planning Policy Framework, Plan Melbourne, and the Homes for Victorians strategy.
Under the Planning and Environment Act, Council also has a legislated responsibility to ‘facilitate the provision of affordable housing in Victoria’. The Act also states that Council is permitted to enter into voluntary section 173 agreements with developers for the provision of affordable housing.
Council should pursue a mandatory affordable housing contribution, not a voluntary contribution.
The current Victorian planning framework does not provide a planning mechanism that enables councils to require developers to provide affordable housing as a mandatory requirement. The revised Policy includes a policy statement that Council will ‘advocate for mandatory inclusionary zoning in the Victoria Planning Provisions to increase the supply of affordable housing provision being provided as part of new private developments’.
Council can withhold a planning permit on the basis that the developer has not provided social and or affordable housing.
Under the Planning and Environment Act, Council cannot lawfully require an affordable housing contribution from developers. Developers must enter into affordable housing agreements voluntarily. If a developer decides not to enter into a voluntary agreement, it will not adversely affect their chances of being issued a planning permit.
Once a section 173 agreement is signed, it becomes a legal document that binds the parties involved, including the landowner and any subsequent owners of the land. Council can then enforce the agreement if the landowner breaches its terms, for example, by not providing an affordable housing contribution.
The affordable housing contribution could be interpreted as a requirement that 6 per cent of dwellings, or an equivalent market value of 6 per cent of dwellings, is gifted as an affordable housing contribution.
Council has responded to developer concerns that this could render new development proposals commercially unviable by updating the definition of the affordable housing contribution to the following: ‘The affordable housing contribution value should be equivalent to the market discount required to provide a dwelling that complies with the Affordable Housing income ranges as defined in the Victorian Planning and Environment Act 1987’.
As a developer we would want to retain the right to potentially deliver the affordable dwellings under a Build to Rent model.
Affordable housing requires long-term management and maintenance. It is important to consider the capacity and commitment of the entity to provide ongoing support and address the needs of the tenants over time. Registered housing agencies, with their focus on affordable housing, may have a stronger commitment to long-term management than developers.
However Council acknowledges that under a build to rent model, developers may prefer to retain ownership of the dwellings. Under this model, Council will require via a section 173 agreement, developers demonstrate that they are meeting their ongoing requirement to provide affordable housing, through regular reporting to Council.
Council should offer incentives to developers to provide low cost housing in the municipality.
Council has responded to community feedback on the Draft Policy about the need for planning incentives by offering the following two approval process advantages:
Providing fast-tracked applications processes within set timeframes.
Ensuring applications are processed by experienced senior staff.
To be eligible for fast-tracking, applications would need to meet a set of prerequisites established by Council’s Planning Department.
Council should prevent properties from becoming vacant and neglected.
The Victorian Government’s Vacant Residential Property Tax (VRLT) was introduced in 2018 to deter vacancies in selected inner Melbourne suburbs (including Whitehorse). The tax relies on voluntary self-reporting and to improve compliance, the revised Affordable Housing Policy includes a clause that Council will ‘advocate for a review of the Victorian Government’s Vacant Residential Property Tax to encourage greater conversion of vacant private accommodation into affordable housing rentals.’
A revised Affordable Housing Policy was adopted by Council on 10 July 2023.
