A new approach to housing choice, affordability and community sustainability

Canberra is growing — not just in population, but in housing needs, lifestyle expectations, and the desire for more flexible living options. To meet this demand, the ACT Government is introducing a major shift in planning policy known as “missing middle housing”. This initiative aims to introduce a greater mix of low-rise housing types across existing suburbs, supporting both affordability and smarter urban design.

What Is ‘Missing Middle’ Housing?

The term “missing middle” refers to housing types that sit between the traditional standalone home and high-rise apartments. These include:

Townhouses

Terraces

Dual occupancies

Duplexes

Small clusters of low-rise apartments (typically two storeys)

These housing styles have been limited within many Canberra suburbs under existing zoning rules — particularly in RZ1 areas — which make up the majority of residential land. The government’s goal is to unlock new housing opportunities without compromising the character of local neighbourhoods.

Recent Reforms & Growing Community Support

In 2025, the ACT Government introduced a reform package aimed at accelerating missing middle housing across existing suburbs. During community consultations, 72% of participants supported the changes, indicating strong backing for more diverse and affordable housing choices.

These reforms reflect a growing understanding that Canberra’s housing challenge cannot be solved by greenfield development alone. Instead, urban infill — using existing infrastructure more effectively — is becoming the foundation for future planning.

Key Changes to Planning Rules

A number of major updates are being proposed to the Territory Plan, including:

Removal of minimum block sizes for an additional dwelling in RZ1 zones

Elimination of the 120m² limit on secondary dwellings (granny flats)

Allowing block subdivision to create multiple titles on a single block

Permitting townhouses, terraces and low-rise apartments up to two storeys

These changes are designed to increase supply while maintaining desirable streetscapes, giving homeowners more flexibility and developers clearer guidelines to follow.

What This Means for Housing Supply

The ACT Government has set a target of 30,000 new homes by 2030, with a significant portion expected to come from missing middle housing. By enabling infill development, Canberra can make better use of transport, utilities, shops and existing services — helping to reduce urban sprawl and keep housing more affordable.

This reform is particularly beneficial for:

First-home buyers seeking an entry point into the market

Growing families who need more space without leaving their suburb

Older residents wanting to downsize and age in place

Investors looking for new opportunities in established areas

A Strategic Shift in Urban Planning

Overall, the push toward missing middle housing marks a strategic shift in how Canberra grows. Rather than expanding outward, the focus is now on building smarter, not bigger — with homes that suit different life stages and budgets.

As the reforms progress, residents can expect to see more choice, flexibility and innovation in housing design — all while preserving the community feel that makes Canberra unique.