NSW Low-Rise Housing Reforms 2026: How Targeted Assessment Could Halve Your DA Approval Time

By Franz Phan, Senior Planning Consultant, giantA Pty Ltd — 15+ years navigating NSW planning and building approvals

Low-rise housing — the dwelling houses, dual occupancies, and multi-dwelling homes that make up the fabric of Sydney's suburbs — accounts for approximately 50% of all development applications in NSW. Yet for decades, these relatively low-impact, low-risk projects have been subjected to planning pathways that are disproportionately complex, inconsistent across council boundaries, and slow. The NSW Government's Low-Rise Housing and Targeted Assessment Discussion Paper, exhibited from 14 May to 24 June 2026, proposes a fundamental shift: a statewide single low-rise housing code with a targeted assessment pathway that could reduce determination times from the current average of 100 days to as little as 50 days.

As practitioners who lodge DAs across multiple Sydney councils every week, we have watched the reform process unfold with both optimism and a healthy dose of professional scepticism. The discussion paper is not yet law — it will need to progress through an Explanation of Intended Effect (EIE), a SEPP declaration, and regulatory drafting before any of this takes practical effect. But the direction of travel is clear, and for homeowners, developers, and builders planning projects in 2027 and beyond, understanding what is coming is essential to making informed decisions today.

What Is Targeted Assessment and How Does It Differ from a DA or CDC?

Targeted assessment is a new planning pathway created by the Environmental Planning and Assessment Amendment (Planning System Reforms) Act 2025, which commenced the legal framework for targeted assessment in March 2026. However, the framework has no practical effect until a State Environmental Planning Policy (SEPP) declares specific development types as Targeted Assessment Development (TAD). The low-rise housing discussion paper is the first significant proposal to use this pathway.

In simple terms, targeted assessment sits between complying development (CDC) and a full merit-based DA. It remains a type of development application — you still need to submit a Statement of Environmental Effects, and the application is still determined by a consent authority. But the assessment is streamlined: certain parts of the standard section 4.15 merit assessment do not apply. Specifically, the consent authority cannot consider the likely significant impacts of the development, site suitability, or the public interest as standalone tests — although public submissions remain a relevant consideration.

The practical effect is that for projects meeting the non-discretionary development standards in the proposed statewide code, the assessment scope narrows considerably. Councils retain decision-making power, but their discretion is tightly framed by the code. This is designed to deliver consistency, certainty, and speed — three things the current system struggles to provide.

The Current Problem: Why Low-Rise Housing Needs Reform

To understand why this reform matters, consider the current landscape. A homeowner in Parramatta wanting to build a dual occupancy and a homeowner in Blacktown wanting the same thing face different development standards, different setback requirements, different landscaping ratios, and different assessment timelines — even though the projects are functionally identical. These inconsistencies come from fragmented Local Environmental Plans (LEPs) and Development Control Plans (DCPs) prepared by individual councils over decades.

The result is a system where low-risk, low-impact housing — the type that should be the easiest and fastest to approve — gets bogged down in the same bureaucratic machinery as complex mixed-use developments. We have seen dual occupancy DAs take 120+ days in some LGAs while identical projects in neighbouring councils are determined in 70 days. The uncertainty makes it nearly impossible to give clients reliable project timelines, which flows through to financing, builder engagement, and material ordering.

The discussion paper directly acknowledges this problem. It proposes consolidating the 8 existing housing codes under the State Environmental Planning (Exempt and Complying Development) Policy 2008 (Codes SEPP) and the low-rise housing provisions in the State Environmental Planning (Housing) Policy 2021 into a single, statewide low-rise housing code. This code would establish consistent, non-discretionary development standards that replace many LEP and DCP provisions for eligible low-rise housing.

How the Proposed Targeted Assessment Pathway Would Work

The proposed framework introduces a three-tier approval system for low-rise housing, with the pathway determined by the project's compliance with the statewide code's development standards. Understanding which tier your project falls into is the first step in planning your approval strategy.

The key innovation is the middle tier. A project that doesn't qualify for CDC — perhaps because the site has a slight slope or the proposed setback is 100mm outside the complying development standard — would previously have been bumped into a full merit DA. Under the proposed framework, if it meets the non-discretionary standards in the statewide code, it can be assessed through targeted assessment, cutting the determination time roughly in half.

What Development Standards Would the Statewide Code Cover?

The discussion paper proposes that the code would primarily focus on design and built form matters. Based on the paper and the parallel Variations and Changes to Complying Development Explanation of Intended Effect (EIE), the standards likely to be covered include:

Crucially, when a TAD application complies with a non-discretionary standard, the consent authority cannot take that standard into further consideration. The standard becomes a fixed benchmark, not a starting point for negotiation. If a standard is not met, the non-compliance is assessed on merit against the objectives of the standard — it does not automatically disqualify the application from the targeted assessment pathway.

Complying Development Variations: A Second Reform That Matters

Running parallel to the targeted assessment proposal is a second reform that could have an equally significant impact on how low-rise housing is approved. The Variations and Changes to Complying Development EIE proposes allowing applicants to seek a variation certificate for certain complying development standards, rather than being bumped into a full DA when their project deviates by a minor margin.

Under the current system, any deviation — even 50mm — from a complying development standard takes a project out of the CDC pathway entirely. This binary outcome has long been a source of frustration. We have had projects where a client wanted to move a garage 200mm to preserve an existing tree, and that single variation triggered a full DA with a 100-day assessment timeline.

The EIE proposes that applicants can apply for a variation certificate from their local council for up to 3 or 4 development standards, with specific limits on the extent of variation permitted. For example, gross floor area can be varied by up to 10%, and building height can be varied up to 9m for dwellings, dual occupancies, and manor homes. The council must determine the variation application within 10 business days (if referred by a private certifier) or 20 business days (if the CDC application was made to council). If the timeframe is not met, the variation is deemed approved.

This reform alone could save thousands of projects from unnecessary full-DA assessment. The deemed approval provision is particularly significant — it creates a hard deadline for councils and prevents the bureaucratic drift that characterises too many DA assessments.

Implementation Timeline: When Will These Changes Take Effect?

The discussion paper is explicit that this is a staged reform. The legal framework for targeted assessment commenced in March 2026, but the practical pathway only activates once a SEPP declares specific development as TAD. The process requires:

1. Discussion Paper (exhibited 14 May – 24 June 2026) — completed, feedback under review
2. Explanation of Intended Effect (EIE) — next step, to be publicly exhibited. Required under section 4.20A(3) of the EP&A Act before any SEPP can be made
3. SEPP Declaration — declares specific low-rise housing types as TAD, specifies eligibility criteria
4. Supporting Regulations — operational details, assessment procedures, timeframes
5. Commencement — staged rollout, starting with dual occupancies, manor houses, and multi-dwelling housing on residentially zoned land

Based on the NSW Government's stated commitment to housing supply and the pace of recent reforms, we anticipate the EIE could be exhibited in late 2026 or early 2027, with the first SEPP declaration and commencement potentially in mid-to-late 2027. The first stage would cover dual occupancies, manor houses, and multi-dwelling housing on residentially zoned land, before expanding to other low-rise housing forms and zones.

For context, the Building (Approvals and Practitioners) Bill 2026 — which passed Parliament on 4 August 2026 — is expected to commence on a date set by proclamation, with regulations developed through 2026–2027 and implementation anticipated from 2027. The government has committed $32.2 million in the 2026/27 Budget to modernise the building approvals system, integrate it into the NSW Planning Portal, and pilot AI tools to speed up licence application processing. These investments signal genuine momentum, not just consultation fatigue.

What These Reforms Mean for Homeowners

For homeowners planning a renovation, extension, or new build, the proposed reforms could meaningfully change your project timeline and budget. If your project qualifies for the targeted assessment pathway, you could see your DA determination in approximately 50 days instead of 100+. That means you can engage your builder sooner, lock in material pricing earlier, and start construction within a timeframe that actually aligns with your life plans.

The complying development variation reform is equally relevant. If you are close to qualifying for CDC but need a minor variation — a slightly larger footprint, a marginally different setback — you can now seek a variation certificate rather than falling into the full DA abyss. The 10-to-20-business-day determination timeframe, with deemed approval if the council misses the deadline, provides a level of certainty that the current system simply does not offer.

However, homeowners should be aware that the reforms do not eliminate assessment entirely. You still need properly prepared documentation — a Statement of Environmental Effects, site plans, and potentially engineering or geotechnical reports depending on your site. The quality of your application matters more than ever, because the streamlined assessment means there is less room for iterative back-and-forth with council planners.

What These Reforms Mean for Developers

For developers working on dual occupancy, manor home, or multi-dwelling housing projects, the reforms offer a competitive advantage to those who understand the new system early. Projects that are designed from the outset to meet the non-discretionary standards in the statewide code will move through assessment faster and with less risk of council objection. This creates an incentive to design to the code rather than pushing boundaries and relying on merit assessment.

The standardisation of development standards across LGAs is particularly valuable for developers working across multiple council areas. Instead of maintaining separate compliance matrices for each council's DCP, a single set of statewide standards simplifies feasibility assessment, design documentation, and project management. We estimate this could reduce pre-lodgement design costs by 15–20% for multi-site developers.

The staging is also strategically important. The first stage covers dual occupancies, manor houses, and multi-dwelling housing on residentially zoned land — the sweet spot for small-to-medium developers. If you have sites in the pipeline that fit these categories, it may be worth timing your DA lodgement to coincide with the new pathway's commencement, rather than lodging under the current system and waiting 100+ days.

What These Reforms Mean for Builders and Certifiers

Builders and certifiers need to understand the interplay between the targeted assessment pathway, the complying development variation mechanism, and the Building (Approvals and Practitioners) Bill 2026. The Bill introduces staged approvals that allow construction to begin earlier and occupants to move in as soon as possible, which aligns with the faster DA determination times the targeted assessment pathway aims to deliver.

For private certifiers, the variation certificate mechanism is a significant change. While certifiers cannot issue variation certificates themselves (only councils can), they can refer variation applications to councils on behalf of applicants. The 10-business-day determination timeframe — with deemed approval if missed — creates a tight deadline that councils will need to resource appropriately. Certifiers should prepare for increased demand for CDC applications that include concurrent variation requests.

Builders should also note the expanded scope of complying development proposed in the EIE, including expanded complying development on bushfire and flood control lots, expanded low-impact remedial works, changes to setbacks for sloping sites, and simplified balcony and privacy screen requirements. These changes incrementally expand the range of work that can be approved without a full DA, reducing friction for common building projects.

Eligibility and Exclusions: What Won't Qualify for Targeted Assessment

The discussion paper is clear that targeted assessment is not a universal pathway. Several categories of development and land are excluded or require careful consideration:

The hazard exclusion is particularly nuanced. The preliminary policy position is to avoid intensification on land that is meaningfully affected by natural hazards, while allowing replacement dwellings or alterations where risks can be managed through appropriate standards. This reflects the practical reality that much of NSW's housing stock sits on land with some level of bushfire or flood risk, and a blanket exclusion would be unworkable.

How the Pattern Book Fits In

The NSW Housing Pattern Book — which offers Government Architect NSW-endorsed architect-designed home templates from $1,000 per lot — operates alongside but separately from the targeted assessment pathway. Pattern book designs are already eligible for complying development, meaning they can be approved via CDC in as little as 10 days. The discussion paper confirms that wholesale integration of the pattern book into the low-rise housing code is unlikely because pattern book development is a bespoke, pre-endorsed design pathway rather than a standardised code-based approach.

For homeowners and developers, this means there are now potentially three fast-track options: the Pattern Book (fastest, CDC, but limited to pre-endorsed designs), complying development with variation certificates (fast, CDC, with flexibility for minor deviations), and targeted assessment (moderate speed, streamlined DA, with the most design flexibility). Choosing the right pathway depends on your site, your design ambitions, and your timeline.

Preparing for the Transition: What You Should Do Now

While the targeted assessment pathway is not yet operational, there are concrete steps you can take now to position your project for the fastest possible approval once it commences:

For homeowners: If you are planning a dual occupancy, manor home, or multi-dwelling project on residentially zoned land, and your timeline allows waiting until mid-to-late 2027, design your project to meet the anticipated non-discretionary standards. Engage a planner or building designer who understands the proposed code framework, and prepare your documentation to a standard that will satisfy the streamlined assessment process.

For developers: Review your land bank and identify sites that fall within the first stage eligibility (dual occupancies, manor houses, multi-dwelling housing on residentially zoned land). If you have sites that currently require a full DA but would qualify for targeted assessment, consider deferring lodgement if your project timeline allows. The potential 50-day saving on determination time translates directly to holding cost savings.

For builders and certifiers: Familiarise yourself with the proposed variation certificate process. Prepare your systems and workflows to handle concurrent CDC and variation applications. The 10-business-day council determination window is tight — your clients will expect you to have their variation applications ready to lodge the moment the framework commences.

Frequently Asked Questions

What is the targeted assessment pathway in NSW?

The targeted assessment pathway is a new streamlined development application process created under the Planning System Reforms Act 2025. It sits between complying development (CDC) and a full merit DA, offering faster determination — approximately 50 days compared to the current 100-day average — for low-rise housing that meets non-discretionary development standards in a statewide code. It remains a type of DA, but with a narrower assessment scope.

When will the NSW low-rise housing reforms take effect?

The legal framework for targeted assessment commenced in March 2026, but it has no practical effect until a SEPP declares specific development as eligible. The discussion paper was exhibited until 24 June 2026, and feedback is under review. An Explanation of Intended Effect (EIE) must follow before any SEPP is made. Based on current progress, we anticipate the first SEPP declaration and commencement in mid-to-late 2027, starting with dual occupancies, manor houses, and multi-dwelling housing on residentially zoned land.

How is targeted assessment different from a normal DA?

A targeted assessment DA does not require assessment of likely significant impacts, site suitability, or the public interest as standalone tests under section 4.15 of the EP&A Act. The consent authority's discretion is tightly framed by non-discretionary development standards in a statewide code. Public submissions are still considered, and the application must still include a Statement of Environmental Effects, but the assessment scope is significantly narrower than a full merit DA.

Can I use targeted assessment for a house on bushfire-prone land?

It depends on the level of hazard. The preliminary policy position excludes intensification on land that is meaningfully affected by natural hazards, but replacement dwellings or alterations may be eligible where risks can be managed through appropriate standards. Highly affected land would be excluded. You should check your site's Bushfire Attack Level (BAL) rating and consult with a planner to determine eligibility.

What is a complying development variation certificate?

A variation certificate allows you to apply to your local council to vary certain complying development standards — such as setbacks, building height (up to 9m), or gross floor area (up to 10% increase) — so your project can stay in the CDC pathway rather than falling into a full DA. You can apply for up to 3 or 4 standard variations per project. The council must determine the application within 10–20 business days, and if the deadline is missed, the variation is deemed approved.

Will the reforms reduce council discretion on low-rise housing DAs?

The reforms will frame council discretion more tightly, not eliminate it. Councils will continue to assess and determine targeted assessment DAs, but when a project meets a non-discretionary development standard, the council cannot take that standard into further consideration. This is designed to improve consistency and certainty across LGAs while preserving councils' role in assessing matters not covered by the code.

Does the NSW Housing Pattern Book use targeted assessment?

No. The Pattern Book operates through a separate pathway — its pre-endorsed architect designs are already eligible for complying development (CDC), which is faster than targeted assessment. Pattern book designs can be approved in as little as 10 days via CDC. The discussion paper confirms the pattern book is unlikely to be integrated wholesale into the low-rise housing code because it is a bespoke, pre-endorsed design pathway rather than a standardised code-based approach.

What types of housing will be eligible first for targeted assessment?

The discussion paper proposes that the first stage will cover dual occupancies, manor houses, and multi-dwelling housing on residentially zoned land. Subsequent stages will expand to other forms of low-rise housing and developments in other zones. Dwelling houses (single homes) are expected to be included in later stages, as many already qualify for complying development.

Need help navigating the NSW planning reforms for your project? Contact giantA Pty Ltd for a feasibility assessment. We'll evaluate your site, identify the fastest approval pathway available now and under the proposed reforms, and prepare your application to meet the new standards. Call us or visit our contact page to book a consultation.

Sources: NSW Planning Portal — Low-Rise Housing and Targeted Assessment Discussion Paper (May 2026); Lindsay Taylor Lawyers — Low Rise Housing Targeted Assessment Pathway Analysis (June 2026); NSW Government — Changes in the Residential Building Industry (August 2026); Environmental Planning and Assessment Amendment (Planning System Reforms) Act 2025; Variations and Changes to Complying Development EIE; NSW Housing Pattern Book — Using the Pattern Book (planning.nsw.gov.au).