Land prices are elevating globally, driving the need for collaborations that can rethink housing to offset the cost of land. This experiment in Australia takes aim at a variety of sustainable solutions.

Micro lots, vertical villages, compact apartments and alternative financial models will be trialled at four demo sites across NSW in a housing affordability experiment by the state government’s land and property agency, Landcom.

In his keynote address at the Committee for Economic Development of Australia’s (CEDA) NSW Property Outlook on Wednesday, Landcom managing director and chief executive John Brogdan said the program would explore and test different innovations in the sector in a bid to tackle the issue.

“Landcom is taking an active role to address the affordability challenge through industry leadership, not only adopting a policy of five to 10 per cent affordable housing on our projects – but in launching a program of demonstration projects,” said Mr Brogdan.

The program will focus on coming up with various affordable housing options for first-home buyers, downsizers and renters. Three of the sites will be in different locations across metropolitan Sydney and one in regional NSW.

While the amount of funding and locations are yet to be determined, Mr Brogdan said more detail would be announced later in the year.

At the first four demonstration sites, Landcom plans to test “vertical villages” – one-stop-shop apartments where all essential amenities can be found in the one place – as well as micro lots that could allow about 12 dwellings to be built in a space the size of a traditional quarter-acre block.

The agency will also explore rent-to-buy and build-to-rent housing models as well as new funding approaches like fractional investments.

Mr Brogan pointed to other design and business examples under consideration, including Melbourne’s citizen-led Nightingale precincts and start-ups like Snug, which facilitate long-term leases to improve security for renters.

Landcom is also currently assisting the Department of Planning in drawing up a “Compact Apartment Guideline” to suit people who want to live in smaller, high-density homes in key areas.

Mr Brogdan suggested new housing models were the “silver lining” of the housing affordability crisis, as high land prices forced an upheaval of a sector that had seen an “innovation deficit” up until now.

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