‘Density bonus’: Call to create new zones specifically for first home buyers

There is a push to allow the creation of new housing “lots” specifically to allow young Aussies to enter the property market as the housing crisis deepens.

A prominent Australian property expert has called for the creation of new housing “lots” to help struggling first home buyers make it onto the property ladder.

It is an incredibly difficult time for young Australians to buy. The cash rate is currently sitting at 4.10 per cent, after previously being held at 4.35 per cent for over a year following a brutal, prolonged period of rate rises.

Property prices have ballooned to more than 10 times the average wage, and median weekly rent is now more than $600 nationally.

While there are grants available to help eligible first home buyers, it seems that the Great Australian Dream of homeownership is getting further and further away for our young people.

It is clear that something needs to be done and property analyst Gavin Hegney believes there is a practical solution that we haven’t yet tried.

Speaking to the West Australian, Mr Hegney suggested the creation of specific zones that only first home buyers can access, removing the competition from investors or people who are already in the market.

The plan would allow first home buyers to purchase specific ‘lots’ without competition from those already in the property market. Picture: NCA NewsWire / Gaye Gerard

Under the scheme, councils would be given special powers to allow homeowners who otherwise may not be eligible to sub divide their properties to do so under the provision the lots can only be sold to those entering the market for the first time.

He told the media outlet it would be a “first homebuyer density bonus”, allowing for the creation of smaller and medium-sized lots.

“Parents often look to assist their children to buy their first home through gifting or loaning money,” Ms Hegney said.

“Similarly, they may do this if their property was able to be subdivided perhaps even retaining the original home and creating a new lot at the rear or the side for one of their first homebuyer children to buy.”

The property expert said that when the lot was onsold buy the initial buyers, it would have to go to another first homebuyer.

Property expert Gavin Hegney said the move would help young Australians to buy their first homes. Picture: Stewart Allen

There have also been calls among industry leaders for Australia to embrace “gentle density” as a way to ease the current housing crisis.

Gentle density refers to the strategic increase of the number of housing options in existing neighbourhoods, often through the addition of more townhouses, micro-lots or triplexes.

The goal is to address housing shortages without drastically altering the flow and look of established communities.

Last month the Housing Industry Association (HIA) called on the government to consider this approach, noting Australia’s housing crisis was now “at tipping point”.

“Gentle density is about building more homes in existing suburbs – close to education facilities, jobs, and transport – while maintaining the charm of our communities,” HIA Executive Director, Planning, Mike Hermon, said.

“With Australia facing a severe shortage in housing availability and affordability, ‘gentle density’ provides a balanced approach by optimising land use and introducing diverse housing options.”

Mr Hermon branded the current zoning laws “outdated and restrictive”, saying that gentle density planning bridges the gap between sprawling houses and towering apartment blocks by supporting middle-ground housing options.

“Australia needs to build 1.2 million homes over the next five years to meet growing demand. Unblocking housing in our existing suburbs is a crucial piece of that puzzle,” he said.

“By streamlining approval processes and allowing for more flexible zoning, we can unlock the potential of our existing suburbs alongside greenfield housing and create vibrant, liveable communities for generations to come.”