An extra 30,000 dwelling sites will be added to Canberra over the next five years in a program of "gentle urbanism" designed to meet housing demand in a city that has expanded faster than expected.
The ACT government will increase the number of dwelling sites it will release for sale in its land-release program, with more than 70 per cent to be in multi-unit developments.
Chief Minister Andrew Barr also hopes build-to-rent projects will add another 5000 dwellings to Canberra's tight rental market, with the government ready to attract institutional investors and superannuation funds to Canberra with tax incentives for building affordable long-term rentals.
Mr Barr said it was clear the government could do more to increase housing supply in the territory, with a focus on different market segments to bring down median property values and rents.
"The market intervention from the government through this policy announcement is to seek to supply more compact housing but housing that sits in a different space to town centre medium-rise apartments," Mr Barr said.
"The answer is not just more 10-storey apartments in town centres and CBDs, although there's still a little bit more capacity and demand for them, but the bulk of the new housing will be in what I'd call that middle sphere. So lower-density apartments, more like walk-up two- and three-storey and in townhouses, row houses, duplexes, that sort of housing density.
"A gentle urbanism is the overarching description I'd use."
The ACT government will also continue to discuss the future of the Australian Institute of Sport campus at Bruce and the former Ginninderra CSIRO experiment station with the Commonwealth as part of redevelopment and housing projects.
A $30 million boost for the public housing renewal program will be included in next week's territory budget, which will fund an extra 140 public housing dwellings. The government will also earmark an extra $57.3 million for public housing repairs and maintenance.
The government reaffirmed its commitment to cut stamp duty in every budget of the current parliamentary term, part of its long-running tax reform program.
Conveyancing duty will be cut by $1120 on houses worth between $260,000 and $1.45 million, while the home buyer concession scheme will increase its income test to $170,000.
The government's new indicative land release program shows 3918 residential dwelling sites would be released to the market in 2022-23, up from 3180 forecast that year in the previous program.
Over five years, the government will release 16,417 dwellings with the private sector expected to release the remaining number of dwellings to the market in that time.
The 2021 census revealed Canberra's population was larger than expected, up 14.4 per cent to 454,000 people since the last count in 2016 and well above the estimated population of 432,000.
Mr Barr said the existing stock of detached homes, which currently made up about two thirds of the total stock in the territory, would continue to serve the family housing needs in the territory.
The Canberra Liberals have repeatedly criticised the ACT government for focusing on multi-unit housing and "constraining" the supply of greenfield land for detached housing.
Mr Barr said one of the challenges in discussing houses was it was falsely seen as homogeneous: "There are a multitude of housing submarkets that reflect people's capacity to pay their preferred locations, their preferred housing types."
The Chief Minister said the size of the average Canberra household continued to fall, but the territory still had some of the largest houses by physical size in the world.
"Part of the policy endeavour here is to provide that spectrum of choice and when people are looking to downsize out of large family homes. They will but they are only going to do that if we address two of the major barriers to doing that. The first is a suitable housing type to downsize into and the second is the stamp duty associated with making that decision," he said.
A prospectus for build-to-rent projects will also invite proposals from early November, and notes discounts and possible waivers for lease variation charges will be available to project proponents who commit to affordable housing in their projects.
Build-to-rent project owners could save more $500,000 a year in taxes in the ACT by ensuring the projects are owned with a single title, which the government said would ensure projects are held for genuine long-term rental use.
"The stampede in this market is being driven by superannuation funds, so effectively the ownership of the housing asset sits with superannuation members, so the broader workforce. And within particular super funds mandates also to provide below market rent housing for their member types," Mr Barr said.
The Chief Minister said he was eager to ensure the ACT maintained a rental vacancy rate of about 3 per cent, which currently sits below 1 per cent.
Mr Barr said there needed to be around 1500 vacant rentals in the ACT based on the current number of rental properties, and build-to-rent projects could make up between 5 and 10 per cent of the rental market in the future.
"My view is that that is best achieved quickly through build-to-rent rather than expecting to find a couple of thousand individual investors to purchase one extra dwelling and make it available on the rental market. I think you'll get there quicker with a large-scale process and it will give more diversity in the rental market," he said.
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