The controversial "missing middle" changes to the ACT's planning laws have taken the next step after being approved by the planning minister.
ACT Planning and Sustainable Development Minister Chris Steel has approved the "missing middle" Major Plan Amendment 04 to the Territory Plan in an effort to encourage denser housing in existing residential areas.
"For too long, the planning system has effectively prevented building anything in-between high-rise apartments or a freestanding house on most blocks in Canberra," Mr Steel said.
"Enabling the missing middle will restore balance and will unlock the supply of low-rise homes that will fit gently into Canberra's existing streets and neighbourhoods.
"Whether you are a first home buyer looking to break into the market, a growing family needing more space, or an older Canberran wanting to age in the community that you love, these changes will provide more choice at every stage of life."
Plans for "missing middle" housing, which includes multi-occupancy housing, townhouses, terraces and low-rise apartments, were first proposed in May 2025. The amendment will apply to Suburban (RZ1) and Suburban Core (RZ2) residential zones, which make up the majority of residential blocks in the ACT.
Under the reforms, the height limit on RZ1 blocks will remain at two storeys, plus attics. Multi-unit, missing middle homes of up to three storeys, plus attics, will be permitted on RZ2 blocks which are typically in well-located areas closer to shopping centres. Subdivision and block consolidation would also be permitted in both zones.
The amendment has received mixed reviews from community groups, industry bodies and construction companies, with some praising the change for allowing better use of land in highly sought inner-city suburbs, while others warned of rampant development dramatically changing streetscapes.
Some Canberra developers also warned in 2025 that the plans were unlikely to be widely acted on unless other economic incentives were also offered.
Data reported in March 2026 showed development of rezoned blocks around Canberra shopping centres and public transport routes had failed to materialise years after the planning changes were made to make denser housing possible.
However, Property Council ACT chief executive Ashlee Berry said missing middle housing was critical for local builders, developers and trades, who relied on smaller, lower-risk projects and had been squeezed out by complexity, delay and rising costs.
"This is about restoring balance to Canberra's housing system. For too long, the planning rules have forced a choice between a freestanding house or a large apartment, with very little in between," she said.
An ACT government spokesperson said the changes would encourage new housing supply in existing suburbs connected to amenities and services, rather than "costly and unsustainable" urban sprawl.
Following a Legislative Assembly inquiry into the changes, the final amendments to the Territory Plan were refined to ensure desired zone policy outcomes, streetscape character, and public domain impacts related to parking were appropriately considered during the development assessment process, the spokesperson said.
The approved amendment is set to be presented to the Legislative Assembly next week, when a notice of motion to reject the legislation change may be moved within the following five sitting days.
"It's now up to Members of the Assembly to decide if they will support the government's practical reforms to increase housing supply for our growing city," Mr Steel said.
If a resolution rejecting the amendment has not been passed by the Legislative Assembly by the end of the fifth sitting day, the amendment will commence on a day set out in a commencement notice.
Once it commences, the amendment becomes a formal part of the Territory Plan and the changes will be applied to development applications.
