The Federal Government has stepped in to mediate a dispute between the University of New South Wales (UNSW) and the National Institute of Dramatic Art (NIDA) over a contentious 1,000-bed student accommodation project, cautioning that UNSW might be violating a long-term lease if it proceeds with the development.

This intervention comes despite the Commonwealth's push for universities to increase student housing to attract more international students and New South Wales's commitment to building 377,000 new homes by 2029 as part of the National Housing Accord.

The dispute centres around a proposal by UNSW and private student accommodation provider Iglu to construct 15- and 16-storey towers on a university-owned car park on Anzac Parade, directly opposite the main UNSW campus and adjacent to a light rail station and NIDA.

Initially, the proposal called for 23 and 20-storey buildings, but after objections from Randwick Council, local residents, and NIDA, the height was reduced. Despite this adjustment, opposition remains.

NIDA's chair, Catherine West, addressed the planning panel and highlighted the potential long-term impacts on NIDA. She expressed deep concerns over the project's effect on NIDA's operations.

The Sydney Morning Herald reported obtaining a July 31 letter from federal arts department deputy secretary Stephen Arnott to UNSW chancellor David Gonski, in which Arnott said he was particularly concerned about the development’s impact on NIDA’s operations and the Commonwealth’s rights as the leaseholder.

The Sydney Eastern City Planning Panel, one of several independent panels set up by the state government to evaluate large or controversial developments, is now tasked with resolving the issue.

Tone on Tuesday recently emphasised the possibility - or rather the necessity - of solving the housing crisis without building homes.

Australia’s housing crisis is not primarily due to a shortage of supply, as there are more houses than households. Instead of focusing on new housing targets, a more effective solution could involve optimising the use of existing homes. This approach is twofold:

Utilising existing houses more effectively

There are approximately one million more houses than households in Australia. Despite a high number of vacant homes—over a million on census night—many remain unused or underutilised.

Current suggestions include taxing unoccupied homes or regulating short-term rentals, but these measures are often piecemeal.

A more structured approach could involve assessing homes for long-term occupation and providing incentives for their use, such as tax rebates, while imposing higher taxes on unused properties. This could include evaluating properties based on their suitability for long-term living or proximity to amenities.

Removing tax incentives like negative gearing and capital gains tax discounts for investment properties could encourage long-term occupancy and dissuade land-banking, with the potential revenue funding social housing.

Increasing occupancy in larger homes

Australia’s large houses, averaging 236 square metres, are often under-occupied, with a low occupancy rate of 2.52 people per dwelling. This results in inefficient use of space, with many homes accommodating only a few residents.

One solution is to subdivide large homes into multiple residences, which could house more people, including family members, students, or essential workers. Incentives such as transferring negative gearing benefits to primary residences and providing tax rebates for home improvements could support this.

Additionally, replacing stamp duty with annual rates could encourage downsizing and better use of existing homes.

Implementing these strategies could significantly reduce housing stress without the need for new constructions.

By converting vacant properties to residential use and increasing the occupancy of existing large homes, Australia could address the housing crisis effectively and immediately.

Image: Current UNSW on-campus accommodation / UNSW

Clémence Carayol

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