“How do the reforms overcome the obstacle of missing middle projects providing fewer opportunities for economies of scale than higher-density projects? To date the projects have provided high-end, not affordable housing,” writes planning columnist MIKE QUIRK.
The Assembly’s inquiry into “missing middle” housing reform provides an opportunity to evaluate the contribution the proposed reforms can make to improving housing affordability and reducing inequality.
Increasing the supply of duplexes, terraces, townhouses and low-scale apartment buildings in established areas has been central to the federal government’s response to the current housing crisis.
It’s a crisis characterised by increased housing stress, wealth inequality and homelessness plus an increasing number of households having to occupy dwellings unsuited to their needs and increasing house prices with the income-to-price ratio doubling from four to eight since 2000.
Groups such as Greater Canberra, building on the arguments for a more compact city (widening housing choice, savings in infrastructure, reduced travel and greenhouse emissions) argue missing middle housing reform will create a more affordable, sustainable and liveable Canberra.
The Assembly Committee should assess if the draft plan amendment is likely to deliver the claimed benefits.
Will the reforms improve housing affordability? Will they substantially widen the range of housing in established areas? Will they reduce the number of poor quality and poorly designed dwellings? Could the objectives of the reforms be delivered by alternative approaches? Should incentives be provided to encourage the inclusion of more affordable housing?
However, the key issue the committee should explore is the extent the provision of missing middle housing increases affordability and housing choice.
This should include an independent analysis of the Auckland housing market, often referenced as an example of where reduced planning controls led to an increase in supply and reduction in house prices.
But the outcome is contentious as columnist Richard Johnston (CN July 31) demonstrated. The variation in housing prices could be a result of the cyclical nature of housing markets.
Will the reforms lead to the substantial provision of housing in established areas that is affordable and designed to meet the demands of households including those with children and downsizers? Will the utilisation of pattern books and design guides necessarily result in the provision of better designed housing?
How do the reforms overcome the obstacle of missing middle projects providing fewer opportunities for construction efficiencies and economies of scale than higher-density projects? To date the projects have provided high-end, not affordable housing.
Such projects do not increase the supply of social housing vital to reducing housing unaffordability, homelessness and the incidence of poverty. Low investment and the sale and demolition of existing public housing units has resulted in the public housing share of the ACT dwelling stock falling from 12 per cent in 1991 to around 6 per cent in 2021. The waiting lists for social housing also continue to grow.
The price differential between stand-alone houses and other dwellings has widened, resulting in a separate house becoming less affordable to an increasing number of households.
Restrictions on the supply of greenfield land may have contributed to the reduced affordability by ignoring housing preferences and resulted in lower sustainability by increasing car-dependent development in surrounding NSW.
The National Housing Supply and Affordability Council’s State of the Housing System (May 2025) report identified the single biggest constraint on supply is the commercial unviability of many projects given current land, financing and development costs relative to expected sale prices.
Approved developments do not always proceed as developers only build when they can make a profit. Until these factors normalise, missing middle renewal is unlikely to be affordable.
There is vagueness about the impetus the reforms will give to the provision of missing middle housing. Will the provision increase by 5 per cent? 10 per cent? 20 per cent or higher?
Perhaps it has been “oversold” by governments to deflect from their failures over decades to construct sufficient social housing or to have the courage to take effective taxation reform from fear of an electoral backlash from the property owning majority.
To genuinely respond to the housing crisis, the missing middle reforms should be part of a multi-faceted approach that also includes the greatly increased construction of social housing, tax reform, increasing the size and productivity of the construction labour force, capping the share of loans to investors, abandoning the 5 per cent deposit scheme and a review of immigration levels (and the associated issues of university funding).
Mike Quirk is a former NCDC and ACT government planner.
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