Key takeaways
The Housing Industry Association (HIA) proposes embracing "gentle density" as a powerful solution to the crisis.
Gentle density refers to medium-density housing (like townhouses, duplexes, triplexes, and micro-lot homes) integrated subtly within established suburbs without compromising their existing charm or character.
Australia urgently needs 1.2 million new homes within the next five years just to meet projected population growth.
Solely relying on greenfield development (building on the urban fringe) isn’t sustainable or effective—it’s costly, inefficient, and negatively impacts liveability.
Solving Australia's housing crisis requires multiple tools; gentle density is one critical approach that has been underutilised.
Embracing this concept would create vibrant, sustainable, and future-proofed communities while preserving the character and soul of existing suburbs.
Australia’s housing crisis has reached a tipping point.
Demand continues to outstrip supply, affordability has fallen off a cliff, and the dream of home ownership is slipping away for many everyday Australians.
For years we’ve talked about building more homes, but the real question is where, how, and what kind?
Now the Housing Industry Association (HIA) is stepping forward with a compelling answer: embrace gentle density to unlock the “missing middle” — those often-overlooked medium-density housing types that could fill the gaping hole in our urban housing mix.
As HIA Executive Director for Planning, Mike Hermon puts it:
“Australia’s housing crisis is at a tipping point, and one of the answers lies in embracing gentle density to unlock the missing middle housing solutions.”
Let’s break that down because the implications are powerful.
What is “gentle density,” and why does it matter?
Gentle density is about threading more diverse, medium-density housing into our existing suburbs without destroying their character.
It’s the townhouses, duplexes, triplexes, and micro-lot homes that sit quietly between detached homes and high-rise towers.
It's the middle ground that offers affordability, flexibility, and choice and right now, it’s largely missing from our urban development toolkit.
It’s not about cramming the suburbs.
It’s about optimising land use in a way that feels natural, not forced.
Hermon says:
“Gentle density is about building more homes in existing suburbs – close to education facilities, jobs, and transport – while maintaining the charm of our communities.”
And that makes sense.
Our current zoning laws often leave Australians with only two options: a sprawling house on the fringe, or a tiny apartment in a city tower.
Neither is working particularly well for the bulk of our population, and neither is solving the crisis at hand.
The scale of the challenge
We need to build 1.2 million homes over the next five years just to meet expected population growth, and that’s a conservative estimate.
Greenfield development alone won’t get us there.
Nor should it.
The cost of expanding our cities outward is massive, not just in dollars, but in the long-term liveability of our urban environment.
Infrastructure, transport links, job access, schools, all these things take time and money to build.
Yet we already have thousands of well-serviced suburbs sitting underutilised due to restrictive zoning and outdated planning frameworks.
Hermon explains:
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“Current zoning laws are outdated and restrictive, often leaving Australians with limited choices between sprawling houses or towering apartment blocks.
Gentle density bridges this gap by supporting middle-ground housing options like townhouses and small-scale apartments.”
In other words, the infrastructure is already there, we just haven’t been using it wisely.
What the HIA is proposing
The HIA’s report, Unlocking the Missing Middle, lays out a strategy for more flexible, responsive planning, one that streamlines approvals and removes barriers to small-to-medium scale developments.
Key proposals include:
- Reforming zoning laws to allow greater diversity of housing forms in established suburbs
- Streamlining planning approvals for well-designed medium-density housing
- Incentivising gentle infill to take pressure off greenfield sites
- Prioritising development in areas with existing infrastructure — close to jobs, education, and public transport
Importantly, they’re not calling for radical changes, but smart, surgical ones.
Hermon adds:
“Planning must be able to deliver on the big picture and use the right tools in the right locations.
This means balancing housing needs both in the inner suburbs and greenfield areas.”
Suburban residential street with row of red brick houses
The opportunity in the “missing middle”
Gentle density offers a pathway to more affordable home ownership while preserving the essence of our communities.
It's especially well-suited to Australia’s evolving demographic mix: think downsizing Baby Boomers, young professionals, single-person households, and essential workers — people who don't need (or can’t afford) a big house, but don’t want to live in a shoebox either.
Yet in many of our most desirable, well-located suburbs, planning schemes haven’t kept pace with modern housing needs.
That’s led to underutilised land, restricted supply, and inflated prices.
Unlocking this “missing middle” could be one of the most efficient, least disruptive ways to increase supply quickly.
A call for leadership and bold thinking
The HIA is urging state and local governments to act now, arguing that it’s time to shift from talking about solutions to actually implementing them.
Hermon says:
“By streamlining approval processes and allowing for more flexible zoning, we can unlock the potential of our existing suburbs alongside greenfield housing and create vibrant, liveable communities for generations to come.”
That’s the kind of long-term thinking we need, not just for today’s housing challenge, but to future-proof our cities for tomorrow.
Final thoughts
Solving Australia’s housing crisis isn’t about one big silver bullet.
It’s about using every tool available and gentle density is a tool we’ve neglected for too long.
It’s time to rethink the way we use our urban land.
It’s time to stop being afraid of change, and start planning for smarter growth, not just more of it.
By embracing gentle density, we can deliver more homes, more options, and more opportunities, all while keeping the soul of our suburbs intact.
