Three storeys everywhere: The radical plan to drive down house prices

Australia's Productivity Commission has proposed a sweeping change to housing policy: allow three-storey homes as the norm across residential suburbs. The plan aims to dramatically increase housing supply and curb soaring prices. Under the proposal, state governments would override local zoning rules that currently restrict most suburbs to single-family homes or low-rise development. The Commission argues that Australia's housing crisis is driven by a chronic shortage of homes, especially in cities like Sydney and Melbourne. By permitting medium-density housing by default, the plan could unlock millions of new dwellings without requiring large-scale rezonings. Critics warn that the change could alter neighbourhood character and strain infrastructure. But the Commission insists that without such bold steps, home ownership will remain out of reach for many Australians. The federal government has not yet endorsed the plan, though it has signalled interest in supply-side reforms. Local councils, which control most planning decisions, are expected to strongly resist the loss of authority. The proposal is now open for public consultation before any legislative action.