The NSW Liberals and Nationals have promised an alternative to the state’s Low and Mid-Rise (LMR) Housing Policy, which they say has underperformed and left communities and local councils with limited say. This comes ahead of the March 2027 NSW election.
The Coalition’s proposed Low and Mid Rise (LMR) Alternate Plan Pathway would let councils submit their own housing delivery plan, provided those plans meets or beats their existing LMR housing allocation. The Department of Planning, Housing and Infrastructure would independently assess and certify any alternate plan before it could apply. Councils that do not submit an alternate plan would operate under the existing LMR rules and any existing development applications already lodged would not be affected.
“More homes are desperately needed on the Northern Beaches, but good planning means listening to local voices and ensuring existing transport and community infrastructure is there to support new growth,” Member for Manly, James Griffin MP said.
“Local voices must play a role in planning where homes will be built in our community.
“Our alternate approach is about respecting local knowledge and listening to those who know the area best, while still delivering local housing targets.
“If a Council can demonstrate it can deliver the same number of homes, or more, through a plan that is better for their community, it should have the opportunity to do so.”
Minister for Planning and Public Space, Paul Scully, told Manly Observer that the Coalition’s proposal is a recycled policy.
“The Liberals and Nationals tried this exact approach three times when they were last in government, and the result was a housing crisis that left NSW with the second most expensive homes on the planet and no housing supply,” he said.
“Handing councils an opt out is not reform, it is a return to the do nothing approach that got us into this mess.
“Trying the same failed idea again will not produce a different outcome.
“It will just mean fewer homes, longer wait times, and higher prices for the people who can least afford it.”
A refresher on the LMR policy
The NSW Government’s Low and Mid-Rise (LMR) Housing Policy came into effect in March 2025, overriding Northern Beaches Council’s planning powers across nine town centres: Manly, Balgowlah, Manly Vale, Brookvale, Dee Why, Forestville, Forestway Shopping Centre, Frenchs Forest and Mona Vale.
It allows homes that were previously limited to single dwellings to be replaced with townhouses, terraces and low-rise apartments up to three storeys, and permits mid-rise apartment buildings up to six storeys (or nine storeys with affordable housing included) near town centres. Because these new rules are “non-discretionary,” Council can no longer reject applications that meet the standards, even where they clash with existing local planning controls. Over 11,000 Northern Beaches properties are estimated to fall within the affected zones, which apply to land within 800 metres of a town centre.
The policy is part of the state government’s push to build 112,000 homes over five years to address the housing crisis.
You can read more about the plans in our earlier coverage here.
Opposition Leader Kellie Sloane said the Coalition supported increasing housing supply but argued the current uniform approach had not delivered the homes needed.
“We need to build more homes, but we also need to recognise that good planning isn’t about applying the same template to every community,” Ms Sloane said.
According to the Coalition, of the 112,000 homes across NSW, only 4,900 homes have been approved under the LMR policy as of February 2026. The NSW Government did not verify these numbers when we asked.
How will the Coalition’s Alternate Plan work on the ground?
Mr Griffin gave the example of Mosman Council, which is developing a Mosman Masterplan.
The aim of the Masterplan is to meet the State’s government’s housing targets for the Mosman LGA while retaining the character and amenity of the area. In short, choosing how and where the dwellings are located within their LGA as opposed to being prescribed by State government.
NSW Planning Minister Scully will need to sign off on the Masterplan; however, he recently told Sydney Morning Herald that while he would consider the council’s Masterplan, he had no intention of switching off the statewide reforms. Instead, he argued that the LMR policy has allowed for housing choices close to shops, transport and jobs.
Under the Coalition’s Alternate Plan, each Council would need to invest both time and funding in developing a similar plan, and each plan would need to be submitted and signed off by the Coalition.
Refresher on the LMR:
