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The urban renewal boosted by new strata laws is likely to be concentrated in Sydney's eastern and inner suburbs with the western suburbs likely to miss out, a new UNSW City Futures report shows.

Renewing the Compact City: Economically viable and socially sustainable approaches to urban redevelopment will be launched at The Mint today by NSW Fair Trading Commissioner Rod Stowe.

The report aimed to explore equitable and viable solutions to the legislative changes and involved interviews with 34 stakeholder groups and a survey of more than 1200 residents, both owners and tenants, of strata dwellings across Sydney.

The new Strata Schemes Development Act (NSW) 2015 will reduce the level of owner approval required to teminate a strata scheme from 100% to 75% – making it easier for older strata buildings to be sold and redeveloped. Equal numbers of strata residents surveyed for the report supported and opposed the changes. 

“We don’t want to see owners forced to sell their homes, nor do we want to see owners holding out simply to receive a larger share of the development value.”

The report shows that gentrification is likely in the inner and eastern suburbs with densification in the middle-ring and little change in the west, meaning the areas in most need of urban renewal are the least likely to benefit.

Director of City Futures, Professor Bill Randolph, said the legislative changes present a fundamental change to the rights and responsibilities of owners of strata titled property in NSW.

“We don’t want to see owners forced to sell their homes, nor do we want to see owners holding out simply to receive a larger share of the development value,” he said.

“Protection of vulnerable groups from hardship is also paramount. Strata residents represent a diverse cross section of the Sydney community with 52% having been born outside Australia and many residents are elderly or have low-fixed incomes.”

Professor Randolph said the findings are significant because jurisdictions in Australia and internationally have traditionally looked to NSW strata laws to create and amend their own legislation.

He said the changes could also affect housing affordability with newer strata buildings likely to replace older and more affordable housing stock. This will likely have the biggest impact in the Eastern suburbs, North Shore and locations near the ocean and harbour.

“It’s all very well getting excited about re-building bijou apartments overlooking the beach at Clovelly for sale at $2 million a pop,” Professor Randolph told The Sydney Morning Herald. “The big problem will be redeveloping old and decaying blocks in areas that are already high density but where, even if it was economically viable to renew strata schemes, lower income families may well no longer be able to afford to buy or rent them.”

“Strata termination and renewal is an issue that requires a whole government response, with a key role for planning in ensuring equitable outcomes,” he said.

Other key research outcomes of the Renewing the Compact City report:

  • A large majority of renters and owner occupiers would prefer to remain in the local area if they were required to leave their current apartment
  • A large majority of owner-occupier respondents said impact on the neighbourhood was an important factor in deciding whether to support a renewal proposal
  • Research participants were concerned that strata renewal might not deliver better buildings and public infrastructure.​

What: NSW Fair Trading Commissioner Rod Stowe to launch the Renewing the Compact City report

When: Wednesday, 25 November, 2-5pm

Where: The Mint, Macquarie Street, Sydney

The research was funded by an Australian Research Council grant with support from the following organisations: UrbanGrowth NSW, Strata Community Australia (NSW), Australian College of Community Association Lawyers, the Owners Corporation Network of Australia and NSW Fair Trading.

Access the full report here.

Read The Sydney Morning Herald article.