Tiny and alternative homes can help ease Australia’s rent affordability crisis
But there are relatively simple, easy-to-implement and cost-effective measures that can be taken to ease the pressures on rent affordability.
These include easing planning restrictions on tiny homes and non-traditional homes, allowing granny flats to be rented to anyone, allowing landlords to rent space to tiny residents and perhaps even subsidize the construction of grandma’s apartments or the modification of houses for double occupancy.
The extent to which local councils allow very small dwellings depends on factors such as dwelling type, lot characteristics, zoning and town plan overlays and state regulations.
Subject to these constraints, granny flats are generally legal in Australia, although states such as Queensland and Victoria restrict who can live there.
In Queensland, most councils limit occupancy to members of the same household, defined as a group that “lives together for the long term and provides food or other essentials for life in common”.
In Victoria, granny flats can only “provide accommodation for a person who is dependent on a resident of the existing accommodation” (and are therefore referred to as Dependent Units).
Although these laws are sometimes ignored, they limit the potential of this affordable housing option for others who are struggling in the housing market. Additional municipal regulations and fees also make building a granny flat complicated, time-consuming and expensive, especially if it incurs infrastructure costs.
Desperately looking for a parking space
Tiny homes, especially those on wheels, are generally not approved for permanent residence. The councils regard them as caravans, with permitted periods of occupancy ranging from zero to around three months.
Some councils will tolerate them but, if they receive a complaint, may require the tiny house to be removed at short notice.
This can cause extreme distress. Some owners of small houses report living in constant fear of being displaced. Over the past few years, we’ve seen an increasing number of posts on the social media pages of small homes advocating for a “parking spot.”
Because of these barriers, most tiny homes in Australia are not in urban areas, where demand for rental properties is highest, but hidden “under the radar” in more rural areas.
These areas generally have more limited access to public transport, employment, education and health services. If they are not known to the authorities, the inhabitants of small houses may also be more exposed to natural disasters such as bushfires and floods.
Benefits of easing restrictions
Removing some restrictions on renting granny flats and allowing and regulating longer-term occupancy for occupants of small homes can help alleviate these rent affordability issues.
There are also other advantages. For municipalities trying to limit the unsustainable, low-density expansion of their fringes, these changes allow for a relatively soft and unobtrusive form of intensification in places where resistance to change is common.
It could also bear more aging in place (allowing older people to downsize while remaining in their neighbourhoods), reducing development pressures on the natural environment and providing valuable income to homeowners and giving local councils a new stream of revenue.
Allowing landlords to rent space to a tiny home dweller (with appropriate regulations on aesthetic appearance, safety features, and environmental impacts) could be a cost-effective and quick way to increase rental supply for certain demographic groups. Single women over 50, for example, are at high risk of homelessness and demographics most interested in life in a small house.
This crisis requires innovative responses
We have seen that when disasters strike, governments can introduce innovative responses to local housing crises.
In response to massive flooding in February and March, the New South Wales government Temporary accommodation policy changed the rules to allow a mobile home or manufactured home to be placed in a disaster area for a maximum period of two years, or more, subject to council approval.
Allowing the tiny houses for a trial period of, say, two years could be a valuable pilot project and perhaps allay the concerns of some local ratepayers. In nine years of research into the Tiny Houses movement in Australia, we’ve found that some councils are willing to consider allowing Tiny Houses – but only if another council does so first.
A longer-term solution is to encourage the construction of more granny flats as part of a moderate densification program, as is the case in Auckland, New Zealand.
Rather than subsidizing expensive renovations of existing homes – as the Morrison government has done with its HomeBuilder Grant Program – Federal, state and territorial governments could offer incentives to divide or expand homes in ways that are well-designed and built sustainably to allow for double living.
While not as dramatic as floods and bushfires, the housing affordability crisis deserves equally imaginative policy responses. After all, adequate housing is enshrined in the Charter of the United Nations Universal Declaration of Human Rights.
The crisis is complex and multifaceted. There are no easy solutions to address it in its entirety and for every demographic group. Tiny houses and grandma’s apartments are not suitable for every household. But the status quo is not a solution.
We need a willingness to experiment and learn innovative and even disruptive approaches.