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Developer Information Sheet 02: IMPLEMENTING YOUR AFFORDABLE HOUSING COMMITMENT

Key steps in delivering affordable housing

1. Address affordable housing in relation to your Development Application, speaking with your Local Government Planning Officer and Renewal SA Affordable Housing Officer.

2. Sign a Land Management Agreement.

3. Design your site plans and stage plans with affordable housing in mind.

4. Lodge your development application, including an outline of how you intend to include affordable housing in your project.

5. Development Application assessment and approval.

6. Lodge your Affordable Housing Plan with Renewal SA which outlines your stage plan and product mix.

7. Design your affordable housing lots and dwellings to meet the affordable housing price point and market demand.

8. Negotiate any pre-sales with not-for-profit housing providers and other affordable rental providers.

9. Develop any product for home ownership opportunities. These can be completed homes, house and land packages, or land allotments.

10. Ensure you include your affordable housing product in the marketing activities for your project, and access free listings on www.realestate.com.au and www.domain.com.au by promoting home ownership product through the Affordable Homes Program. This will target your product to eligible buyers as required by your Land Management Agreement.

11. Request rescission prior to deposit stage of plan for land division approval (stage by stage).

12. Report affordable housing sales to Renewal SA.

What is the process for executing the Land Management Agreement?

Under the Affordable Housing Gazette notice (Determination of Criteria for the Purposes of the Concept of Affordable Housing, Regulation 4 of Development Act 1993), affordable housing must be secured by a legally binding agreement:

2 (1) (e) in the case of an application for a development authorisation—a legally binding agreement between the developer/owner and a Minister, or instrumentality of the Crown in right of the State or Council (constituted under the Local Government Act 1999 (SA)), is in place to ensure that the sale of the Land or Dwelling complies with the requirements set out in this Notice;

Land Management Agreements under section 57 or section 57A of the Development Act 1993 are used by Renewal SA to confirm the commitment to deliver 15 per cent affordable housing in your residential development.

The steps for processing a Land Management Agreement are below, and can be found in Figure A.

1. Land Management Agreement Executed and registered with Lands Titles Office

2. Proposal plan lodged and referral to Minister for Housing and Urban Development

3. Development Approval (DA) granted

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4. Land division lodged by stage

5. Land Division Certificate of Approval issued by stage

6. Send request to Renewal SA to rescind LMA over that stage

7. Executed application for rescission returned to your nominated contact

8. Certificates of Title issued

The standard legal agreement can be negotiated to respond to individual developments requiring variation. Core conditions of the agreement include:

Provision of at least 15 per cent of allotments or dwellings (house and land packages) to be

affordable, which may include:

o Home purchase below the price point (i.e. $332,000 for completed dwelling or house and

land packages in Greater Adelaide)

o Land only below the price point (i.e. $149,400 in Greater Adelaide)

o Sale to an affordable rental provider (negotiated price)

For affordable home purchase properties a first right to purchase must be offered exclusively to

eligible home buyers for a period of at least 30 days

Provision of a staging plan for larger developments showing how the affordable housing will be

distributed across the site and between stages (Affordable Housing Plan)

Provision of sales reports on affordable allotments, dwellings and packages.

You will receive one original from your Affordable Housing Officer. Once signed, return the LMA and supporting documentation to Affordable Housing Officer at the below listed address: Renewal SA Att: Affordable Housing Officer GPO Box 698 ADELAIDE SA 5001

Renewal SA will then arrange for the Agreement to be executed and noted on the Certificate of Title with the Lands Titles Office.

A copy showing the Lands Title Office registration number is returned to you. In some circumstances Renewal SA attends settlement so the Land Management Agreement is registered in series immediately after the transfer.

What is an affordable housing plan?

An affordable housing plan is a staging plan that outlines how your development will meet the 15 per cent affordable housing requirement across the project. The plan should take into consideration the location of allotments, indicative pricing, and target tenure mix of the affordable housing.

An affordable housing plan must be provided to Renewal SA to supplement the Land Management Agreement. The plan does not initially have to show specific allotments but must include the total number of dwellings in each stage and can be revised and amended to reflect changes as the project progresses.

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What is a price variance?

For sales to eligible home buyers, a variance of up to 15 per cent above the maximum sale price can achieved if the dwellings/packages offer specific:

Environmental inclusions

Finance opportunities

Transport options in conjunction with a smaller allotment size

Dual occupancy opportunities

The variation assists developers to provide better quality affordable housing, both at the initial sale price and in relation to reducing ongoing living costs. To assess if your development meets any of the above listed variance opportunities refer the Developer Information Sheet 03: Price Variance.

If you’re seeking approval to use the price variance option, please discuss it with your Affordable Housing Officer. Dwellings including a variance need to be identified in your Affordable Housing Plan, and supporting documentation attached, as outlined in the variance fact sheet.

A price variance is not available on land only product.

What are specialised finance products?

Special finance products include initiatives such as a shared equity home purchase option to assist eligible buyers to purchase into your development. Shared equity will generally require an investor to partner with the developer to hold the equity of the sales during the period before the homebuyer pays the full amount off. Other specialised finance products could focus on low deposits, shared equity models or rent to buy options.

If your plan proposes product which increases eligible buyers’ purchasing power, while maintaining affordable loan repayments, you should discuss this with your Affordable Housing Officer as soon as possible as additional processes may apply.

How do I include affordable housing in my development application?

When you lodge your land division application with the Development Assessment Commission (DAC) it is recommended you attach:

A copy of your Affordable Housing Land Management Agreement

The affordable housing allotments on your proposed plan of division.

DAC will refer the application to the Minister for Housing and Urban Development’s delegate (Renewal SA) via the electronic development application lodgement and assessment system (EDALA). A fee is not charged for this referral.

Renewal SA has three weeks to respond. The response will indicate if the proposed affordable housing meets criteria for affordable housing as stated in the Affordable Housing Gazette Notice and secured by agreement.

If the Development Plan includes planning requirements for affordable housing that you propose to take advantage of (i.e. reduced site area and car parking), the relevant authority will want

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evidence/confirmation that the development has an affordable housing legal agreement in place before issuing Development Approval.

Do I need to resubmit affordable housing information when lodging stage plans?

When lodging each stage plan, attach a separate sheet with the final plan identifying the allotments marked for affordable housing and list the lot numbers for affordable housing outcomes in that stage.

The Department of Planning, Transport and Infrastructure (DPTI) will contact Renewal SA for clearance via EDALA before the Land Division Certificate of Approval is issued.

When is the Land Management Agreement rescinded?

The Land Management Agreement is rescinded for each stage of your project as you prepare the Certificate of Approval and final plans to be lodged with the Lands Titles Office. For apartment projects, it will be rescinded in time to be lodged together with your community plan.

Email your Affordable Housing Officer to request a rescission of the Land Management Agreement and include the:

Unique EDALA identification number and development number if applicable

Deposited plan and lot numbers marked for affordable housing

Please make the request in time for the application for rescission to be prepared and executed (estimate two week turn around).

The executed application for rescission will be returned to your nominated contact, and you will need to lodge your application for rescission with your deposit of plan of division.

What fees and charges are involved?

Renewal SA aims to reduce costs associated with securing affordable housing, which means we:

Do not charge any fees for preparing and lodging the land management agreement

Do not charge a referral fee to process development application referrals. Other standard DPTI

administration fees and referral fees for other agencies will still apply

Do not require a document preparation fee for preparing Rescission Applications when they are

done as a whole stage or in large parcels.

Standard Lands Titles Office fees will apply when lodging rescission applications.

Who can I sell affordable housing to?

You can sell your affordable allotment or housing to any eligible buyer, including:

Eligible home buyers through the Affordable Homes Program

Community housing providers or a not for profit housing providers

South Australian Housing Trust

Anyone else nominated by the relevant Minister.

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What assistance is available with marketing?

The Affordable Homes Program provides an opportunity for eligible home buyers to identify and purchase affordable housing developed under the 15% Policy. Affordable homes under the Program are listed on www.realestate.com.au and www.domain.com.au with our distinctive ‘key’ branding.

The ‘key’ signals a property is exclusively available for sale to eligible buyers for a limited period of time and at a fixed price (minimum of 30 days unless sold prior).

If, at the end of your minimum 30 day exclusive listing period, your product has not been purchased

by an eligible home buyer you can choose to extend your listing under the Affordable Homes Program

(to a maximum of 90 days), or sell on the open market at the same price which will still count towards

your affordable housing targets.

Electronic newsletters can also be sent out to our database of eligible buyers to promote the

development.

For more information about selling your affordable housing through the Affordable Homes Program, speak to your Affordable Housing Officer.

What are the reporting requirements?

Reporting requirements are simple and based on existing project schedules and records. The report will be sent to you as required for updating. The data is collated for reporting to the State Government on the delivery of affordable housing under the 15% Policy.

Further information

Affordable Housing Team Strategy & Innovation Phone 08 8207 1300 E-mail affordablehousing@sa.gov.au

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Figure A: Applying and removing Land Management Deeds

Step 1: Renewal SA facilitates execution and registration of Land Management Agreement

Step 2: Consultation with Renewal SA on your Affordable Housing Plan

Step 3: Development Application

Developer lodges Development

Application with assessing authority

(DAC / Council)

Renewal SA response:

Does or does not satisfy LMA

Council / DAC determination

Attaching

EDALA referral

LMA

DA granted

AH Plan by stage

(sheet 1)

Developer proposes

Affordable Housing Plan (AH Plan)

Renewal SA feedback on AH

Plan

Final AH Plan agreed by Renewal SA and Developer

Developer signature

Minister for Planning / delegate

signature

Land Management Agreement (LMA)

Renewal SA registers LMA with Land Titles Office

Land Management

Agreement

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Step 4: Land Division - Final Plan

Step 5: Rescission & Certificate of Title

Developer sends rescission request to

Renewal SA

Developer lodges Final Plan with LTO

Land Title Office rescinds LMA

Renewal SA coordinates rescission request from Minister

Planning/delegate

Attaching Email Renewal SA

CT issued

Executed application for

rescission

EDALA number

AH deposited plan no.s

(sheet 1) Summary affordable housing in

stage

(sheet 1)

Separate sheet on AH Plan showing

affordable housing allotments

Developer lodges division plan

identifying AH on site plan

Council / DAC determination

Renewal SA response: Meets requirements

Attaching

EDALA for clearance

Certificate of approval

issued