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Grattan Institute Urges Citywide Upzoning to Cut Housing Costs

The report proposes three storeys on all residential land, with six near transport hubs, to lift supply by 67,000 homes a year.

Overview

  • Grattan recommends allowing townhouses and apartments of up to three storeys across capital-city residential blocks, with six storeys near major transport and centres, using faster permit pathways for compliant projects.
  • Its modelling projects rents about 12% lower within a decade and the median house price roughly $100,000 lower, with additional long-term economic and emissions benefits from denser, well-located housing.
  • The think tank estimates capacity for up to one million commercially feasible homes across Sydney and about 431,000 within 15km of Melbourne’s CBD if planning rules are overhauled.
  • Heritage overlays, layered council rules and slow appeals constrain delivery, with VCAT overturning 49% of council rejections and applicants waiting an average of 193 days when rejections are reversed.
  • The release lands as federal 5% deposit guarantees rose to 5,778 in October, drawing criticism for lifting lower-end prices, and as insurers and banks caution against placing new homes in disaster‑prone locations due to insurance affordability.