Nearly 60,000 new homes could be built in Canberra if the government agreed to "upzone" more suburban land to allow greater development in areas which now only allow single detached houses, the Property Council says.
A report commissioned by the industry group said conservative assumptions for upzoned land would deliver the new dwellings across about 21,000 blocks.
"Of a sample of 123,000 ACT blocks, this reform would affect around 65,161 blocks. We estimate that RZ2 zoned land will increase from 15,061 blocks to 50,417, and RZ3 will increase from 8,169 blocks to 14,744. RZ1 will reduce from 99,894 to 34,733," the report completed by Purdon said.
Gino Luglietti, the Property Council ACT interim executive director, said the research showed a clear pathway to deliver the housing the capital needed.
"These proposed reforms offer a solution that meets housing demand while also preserving our green space and providing a significant land boost to the economy," Mr Luglietti said.
"The report forecasts the reforms could generate $26.5 billion in construction activity by 2060, with substantial benefits for both the private sector and government revenues."
Mr Luglietti called on the next ACT government formed after the October election to adopt the proposal to increase development rights for RZ1, 2 and 3 blocks.
The Purdon report recommended upzoning all RZ1 blocks larger than 700 square metres to current RZ2 rules, and upzoning RZ1 blocks to RZ3 when they score on a size and quality index above 70 per cent.
RZ2 land should become RZ3 when the blocks are larger than 950 square metres and achieve a quality score above 50 per cent.
The government should also allow lease holders to assess the potential return from upzoned land before they face significant lease variation charges, the report said.
"The first main conclusion is that most new dwellings will be in suburbs in Belconnen, and Tuggeranong. Of the dwelling types, the majority will be attached dwellings (64%), and of those the majority will be 2- and 3-bedroom semi-detached townhouse style dwellings," the report said.
A missing middle design guide has been commissioned and a re-elected Labor government would consider further changes, following last year's planning system overhaul, in the next term.
"We will deliver more homes close to public transport and increase economic opportunities through proximity to local jobs and services," ACT Labor planning spokesman Chris Steel said.
"That is why we have committed to supporting the delivery of 30,000 new homes by 2030."
Mr Steel said Labor welcomed the Property Council's endorsement of light rail as a key driver of housing supply.
Planning system changes late last year meant 45,000 RZ1 blocks larger than 800 square metres would allow a second dwelling.
