Co-Living Housing in NSW: 15 Essential FAQs for Developers, Architects, and Residents

Co-living housing has emerged as a dynamic solution to NSW's housing challenges, offering shared spaces that promote community while providing private retreats. As urban density increases and lifestyles evolve, co-living developments are gaining traction under the State Environmental Planning Policy (Housing) 2021 (Housing SEPP). However, ensuring these spaces are inclusive and compliant with accessibility standards is crucial for long-term success and regulatory approval.

At Sydney Access Consultants, we specialize in bridging architectural design with disability access expertise. Our team, including qualified access consultants like Alexandra (Sandy) Gray on the Mid North Coast and our partners in Sydney and Perth, helps ensure co-living projects meet Australian Standards such as AS 1428.1 (Design for Access and Mobility) and the National Construction Code (NCC) Volume One. This not only minimizes compliance risks but also enhances liveability for all residents, including those with disabilities.

Whether you're an architect designing a co-living space in Sydney's bustling suburbs or a developer eyeing opportunities in Perth's growing market, understanding the basics is key. Below, we answer 15 frequently asked questions based on the latest Housing SEPP amendments (as of 2026) and NSW planning guidelines. These insights draw from our extensive experience in adaptable housing and inclusive design, ensuring your project aligns with current building codes.

1. What is co-living housing in NSW?

Co-living housing is a form of residential accommodation with at least 6 private rooms (each for individual or shared occupancy by no more than two adults), plus shared communal facilities such as living areas, kitchens, and laundries. The rooms and shared spaces must be fully furnished and ready-to-occupy, with on-site or readily contactable management to foster community. It is designed as a primary place of residence (minimum 3 months), not short-term tourist accommodation. From an accessibility perspective, incorporating features like wider doorways and level access in communal areas (per AS 1428.1) can make these spaces truly inclusive.

2. How does co-living differ from boarding houses?

Both fall under similar built-form standards in the Housing SEPP, but key differences include: co-living has no mandatory affordability requirement, receives a smaller Floor Space Ratio (FSR) bonus (10% vs 30% for boarding houses), typically features larger/more self-contained private rooms (often with ensuites/kitchenettes), and emphasises community-building management. Accessibility-wise, co-living's focus on larger rooms offers opportunities for adaptable designs compliant with AS 4299 (Adaptable Housing), which our consultants recommend for future-proofing.

3. Where is co-living housing allowed in NSW?

It may be carried out (with development consent) on land where co-living housing, residential flat buildings, or shop top housing is permitted under the local environmental plan (LEP), another EPI, or under specific Housing SEPP chapters (e.g. low and mid-rise housing areas or TOD precincts). Recent amendments (2025) clarified permissibility in certain R2 and R3 zones where residential flat buildings are allowed via low/mid-rise or TOD provisions. In areas like the Mid North Coast, where our partner Sandy Gray operates from Black Beach, local projects can benefit from tailored access audits to navigate zone-specific requirements.

4. What are the minimum development standards for co-living housing?

Clause 69 of the Housing SEPP sets standards including: minimum private room sizes (typically 12–25 m² excluding any private kitchen/bathroom), minimum communal indoor/outdoor space per occupant, bicycle parking (where required by council), waste management, and management presence (manager contactable 24/7, though not necessarily on-site full-time). We advise integrating NCC accessibility clauses early, such as ensuring 20% of rooms meet Livable Housing Design Guidelines Silver level for better market appeal.

5. Does co-living housing receive any planning bonuses or incentives?

Yes — a 10% bonus to the applicable floor space ratio (FSR) is available under the Housing SEPP, similar to boarding houses but at a lower rate. This can increase developable floor area on qualifying sites. For projects in Perth, where sensitivities around trading names like "Sydney" may arise, we focus on localized branding while leveraging these incentives to incorporate robust access features without compromising design.

6. Is co-living housing required to be affordable?

No — unlike some boarding house or social/affordable housing provisions in the Housing SEPP, there is no mandatory affordability component or requirement to involve a registered community housing provider. However, blending affordability with accessibility (e.g., NDIS-aligned designs) can attract diverse tenants and government partnerships, an area where our team's expertise shines.

7. Can co-living housing be used for short-term or tourist accommodation?

No — it must provide a primary place of residence and cannot be used for short-term rental accommodation (STRA) or tourist/visitor accommodation. It is explicitly excluded from the STRA exempt development pathway and register. This long-term focus allows for deeper integration of inclusive elements, such as tactile indicators and braille signage per AS 1428.2.

8. Does the Apartment Design Guide (ADG) or SEPP 65 apply to co-living developments?

Generally no — co-living housing is exempt from State Environmental Planning Policy 65 (Design Quality of Residential Apartment Development) and the Apartment Design Guide unless the relevant local environmental plan (LEP) specifically requires it. That said, voluntary adherence to ADG principles can enhance accessibility, and our audits often reference these for performance solutions.

9. What is the minimum site area or lot size for co-living housing?

Since the 2022 amendments, the minimum lot size is 600 m² in Zone R2 Low Density Residential and 800 m² on other land (simplified from earlier rules). Site area per room/occupant ratios also apply under Clause 69. For Mid North Coast sites, Sandy Gray's local knowledge ensures compliance with regional variations, including flood-prone area adaptations.

10. Is on-site parking required for co-living developments?

Car parking requirements are set by the local council's LEP and DCP. The Housing SEPP itself removed minimum bicycle and motorcycle parking mandates in 2022, but councils may still impose resident/visitor car parking depending on location (many inner/middle-ring sites have reduced or nil requirements due to transport access). We recommend accessible parking bays compliant with AS 2890.6 to support residents with mobility needs.

11. Who manages a co-living property and what are their responsibilities?

A manager (on-site or off-site) must be appointed and contactable 24/7. They are responsible for shared spaces, encouraging community, maintenance, and resident issues — similar to boarding house management but with a stronger community focus. Training managers on accessibility protocols, as per our capacity-building workshops, can prevent common issues like blocked pathways.

12. Can co-living developments include ensuite bathrooms or kitchenettes in private rooms?

Yes — many modern co-living designs include private ensuites and/or kitchenettes in rooms (unlike traditional boarding houses). This is permitted provided overall communal facilities meet the minimum standards. Ensuring these private features are accessible (e.g., roll-in showers per AS 1428.1) adds value, especially for NDIS participants.

13. How does the Low and Mid-Rise Housing Policy or Transport Oriented Development (TOD) program affect co-living?

Recent updates (2024–2025) expanded permissibility and removed barriers so co-living can benefit in low/mid-rise housing areas (within 800 m of town centres/stations) and TOD precincts where residential flat buildings are permitted, increasing opportunities in R2/R3 zones and near transport. In Perth's TOD zones, our emerging services emphasize sensitive, inclusive designs to align with local preferences.

14. What development application process applies to co-living housing?

Development consent is usually required via the NSW Planning Portal (local council determination for most projects; some larger/complex ones may be regionally or state-significant). Complying development is generally not available. Applications must demonstrate compliance with Clause 69 standards. Our team assists with access reports to strengthen DA submissions and avoid delays.

15. Can existing buildings (e.g., houses or motels) be converted to co-living housing?

Yes — adaptive reuse is common and encouraged, provided the development meets Housing SEPP standards (room sizes, communal areas, management, etc.) and obtains development consent. Heritage, fire safety, and building code upgrades often apply. Conversions offer a prime chance for accessibility retrofits, drawing on our expertise in AS 1428 series standards.

Co-living housing represents a forward-thinking approach to urban living in NSW, but overlooking accessibility can lead to costly revisions or non-compliance. As leaders in disability access consulting, Sydney Access Consultants (trading as GJ Finn & DW Wong) helps architects and developers integrate inclusive design from the outset—whether in Sydney, the Mid North Coast with Sandy Gray, or our expanding Perth market. For Malaysian parallels under MS 1184:2014, visit our sister site at accessconsultants.asia.

For site-specific advice, always check the local council's LEP/DCP, the current version of the Housing SEPP on legislation.nsw.gov.au, and the NSW Planning Portal. Pre-lodgement advice from council or a town planning consultant is strongly recommended for any proposed co-living project.