By Aaron Gadiel, Partner
The NSW Government has made some changes to planning provisions governing group homes, build-to-rent housing, seniors housing and ‘infill affordable housing’.
Overall, the changes will make life a little easier for some developers of group homes, build-to-rent housing and seniors housing.
The changes took effect on 19 September 2025.
In general terms, a ‘group home’ is used to accommodate people with a disability or people who are socially disadvantaged.
On 19 September 2025, the NSW Government published the Standard Instrument (Local Environmental Plans) Amendment (Group Homes) Order.
This order introduced new replacement definitions for ‘group home (permanent)’ and ‘group home (transitional)’ in the ‘Standard Instrument’.
These definitions are used in all Standard Instrument-compliant local environmental plans.
Importantly, they are also used to define the scope of the ‘group homes’ complying development pathway in Part 2 (‘Group homes’) of Chapter 3 (‘Diverse housing’) in the State Environmental Planning Policy (Housing) 2021 (the Housing SEPP).
The new definitions are welcome, as some registered certifiers have been refusing to issue complying development certificates for group homes due to the ambiguity in the previous definitions.
Notably, the new definitions abolish the requirement that residents of a group home must live as a ‘single household’.
This removes a requirement that has caused some certifiers particular headaches.
It also more clearly enables group homes to be designed in a way that encourages residents, when able, to live independent lives — consistent with modern approaches to supported housing.
However, the definitions continue to exclude development that is subject to Part 5 (‘Seniors housing’) of Chapter 3 of the Housing SEPP.
This makes it necessary, in each case, to ensure that premises that are said to be a ‘group home’ do not fall into the definitions of:
Generally, in our experience, with an appropriately formulated proposal, this problem can be dealt with.
The new definitions do not apply to any development application that was made, but not determined, before 19 September 2025 (as per clause 8 of the Standard Instrument (Local Environmental Plans) Order 2006).
Also, on 19 September 2025, the NSW Government published the State Environmental Planning Policy (Housing) Amendment (Group Homes) 2025. This amendment made changes to Housing SEPP provisions for group homes (and some other matters too).
These changes apply immediately. They affect complying development certificate applications that have been lodged, but not yet determined.
Some of these changes are briefly summarised here.
Firstly, a provision that was designed to make it more difficult for a consent authority to refuse — or adversely condition — a development consent for a group home has been deleted. This affects any pending development application, as well as future development applications.
Secondly, there are some new development standards concerning the change of use of a class 1a (single dwelling) into a new group home by complying development certificate.
Thirdly, a provision preventing the subdivision of group homes is introduced. The affects both the grant of development consents and the issue of complying development certificates.
Fourthly, the rear setback requirement for a group home that is complying development and a height of 3.8 metres or more has been changed. Previously, it was 3 metres plus an amount that is 3 times the additional building height above 3.8m, up to a maximum setback of 8 metres. Now it is:
Furthermore, a concession that allowed, on a site that has a rear boundary with a laneway, for the building to abut that boundary for up to 50 per cent of the length of that boundary has been broadened. It now also allows the building to be erected within 0.9 metres of that boundary.
There has also been some revision of the provisions allowing exceptions to the setbacks.
Fifthly, previously, the landscaping requirement for a group home that is complying development was as follows:
This has now been revised so that:
The 20 per cent of the site area requirement is unaffected.
Sixthly, the principal private open space requirement for a group home that is complying development has been changed, to reduce the width requirement from 4 metres to 3 metres, but also to introduce a new 3-metre length requirement.
Seventhly, requirements for earthworks, retaining walls, structural support, drainage, fences and swimming pools for a group home that is complying development have been revised.
Finally, there have been some other minor clarifications to the development standards for group homes in Schedule 2 of the Housing SEPP.
The State Environmental Planning Policy (Housing) Amendment (Group Homes) 2025 also changed some non-discretionary development standards for build-to-rent housing.
The Environmental Planning and Assessment Act 1979 (the EP&A Act) provides for ‘non-discretionary development standards’.
This name is misleading as the purpose of such development standards is to set out standards that — if complied with — prevent the consent authority from requiring more onerous standards for those matters.
Non-compliance with these particular development standards does not prevent development consent being granted. In short, these development standards limit the discretion of the consent authority, but do not limit the freedom of the developer.
For build-to-rent housing there is a non-discretionary development standard for car parking within the ‘Eastern Harbour City, Central River City or Western Parkland City’ (ie generally greater Sydney as it is traditionally understood). Until now, the non-discretionary development standard was:
As of 19 September 2025, the standard has been changed to be as follows:
This is welcome, as it allows a developer to take the benefit of the development standard if the developer chooses to supply more car parking than specified by the numbers in the provision. That is, the standard no longer sets an actual rate, but a minimum rate.
This change affects pending and future development applications.
In certain circumstances, seniors housing may benefit from an incentive floor space ratio and height set out in section 87 of the Housing SEPP.
This provision has, for some time, been oddly worded. Read literally, it only applied when a development hit, and only hit, specific floor space ratio numbers. (Having said this, a good case has existed that the provision should not be read literally, but purposively.)
However, as of 19 September 2025, these floor space ratios are now clearly expressed as maximums.
A further change has been made, which may have a more practical benefit.
Previously, extra floor space ratio needed to be achieved before a developer could benefit from an extra 3.8 metres in permissible building height.
As of 19 September 2025, this extra height can be made available for qualifying seniors housing development, even if no extra floor space ratio is achieved. This can be particularly helpful in sites that are not subject to a maximum floor space ratio (but are subject to a maximum height standard).
This change affects pending and future development applications.
Until now, section 90 of the Housing SEPP only provided for the subdivision of land after a seniors housing development had been carried out. (Having said this, subdivision may still have been permitted in other circumstances under other environmental planning instrument provisions.)
As of 19 September 2025, section 90 now permits such subdivision even before the carrying out of the development is completed.
There is also now an express provision that says that development consent for the subdivision of land may be granted at any time, including before the development is carried out.
The existing restriction on the grant of development consent for the subdivision of a seniors housing building on land in ‘Zone E2 Commercial Centre’ or ‘Zone B3 Commercial Core’ has been retained.
This change affects pending and future development applications.
The ‘infill affordable housing provisions’ have been extended to the ‘E2 Commercial Core’ zone in some regional areas.
Overall, these changes are generally beneficial to development applicants and clarify some long-standing problems with group home provisions. They also provide some modest improvement to build-to-rent and seniors housing provisions.
If you would like further information or have any queries regarding other matters, please do not hesitate to contact:
