Affordable Housing Investment in NSW

Affordable housing is an exciting new investment and development opportunity in Central Western Sydney. There is: 1. a strong demand for affordable housing; 2. various government incentives for approved dwellings, and 3. the opportunity for developers to contribute to the well-being of communities in positive ways.

The NSW Family and Community Services (FACS) has a Centre for Affordable Housing. You can read about it on their web pages: For Developers of Affordable Housing. Here is a helpful summary below:

Floor space incentives

The NSW Department of Planning offers floor space incentives for new affordable housing buildings (villas, townhouses and flats).  They must be in accessible and pre-approved areas of the state. This provides builders and developers extra cash to provide affordable housing, based on how much floor area they are adding to the state’s affordable housing resource.

Other incentives

Local councils have their own incentives to encourage builders and developers to provide affordable housing. An example of this kind of incentive is in the negotiations of planning agreements. For other incentives, refer to the relevant local council. Like this document about Parramatta City’s affordable housing policy which shows that council have certain bonuses available to different sized developments, especially over 100 dwellings.

Financial incentives

There may be government help available in the form of National Rental Assistance Scheme (NRAS), which is paid to landlords to supplement low rent. Though at the time of writing it only affects some projects started before 2014. There is currently no new NRAS specifically available.

There are current grants however for new boarding house developments. The Boarding House Financial Assistance Program is a grant available for up to $10 000 per room of newly constructed boarding house accommodation that is self-contained. This is a big opportunity for developers, and is also a great way to contribute to the community. Effective Building and Construction can assist and advise on grant applications as well as construction of boarding house projects in Sydney.

These projects have stipulations to qualify for the grants, including that they must be newly operating boarding houses, with a long term commitment, zoned as residential by the council and registered with NSW Fair Trading.

There may also be Land Tax exemptions offered by the Office of State Revenue

Grants for upgrades

Existing boarding houses may be eligible for grants of up to $50 000 to improve the fire safety infrastructure of the property. These grants are paid in instalments over five years, after works are completed and approved by the FACS – Housing.

The grant can cover such council ordered works as: sprinkler systems, detectors, lighting, solid core doors and extinguishers. It can also be used to cover the cost of consultants and designers, and council construction certificate fees.

Partnerships with housing providers and developers

The NSW government has made it easier for developers and investors to partner with housing provider organisations to realise the goal of building more dwellings for low income individuals and families. There is a database of community housing providers on this website, many of which are looking for partners to be involved the construction of new dwellings. The Centre for Affordable Housing seeks to assist these partnerships to continue to deliver enough affordable housing options for the future of Sydney.

Required to be managed by registered community housing provider

For a project to be considered part of the affordable housing scheme, and for a developer to qualify for the government incentives, once built it must be managed properly as an affordable housing premises for at least ten years. These can in fact be self-managed by you, or handed to various tenancy managers who specialise in affordable housing management post construction.


To read more about the current housing climate in Central Western Sydney visit this page. Or speak with us about investment opportunities opening up to meet the housing needs of the Parramatta to Blacktown regions of Sydney.