NSW Government Increases Housing Density in Tweed Heads and East Lismore, Mayor Seeks More Affordable Housing

A northern New South Wales mayor has welcomed the decision to increase the density of a large apartment complex at Tweed Heads, but has urged the state government to increase the amount of affordable housing on the site.

The NSW government this week unveiled a master plan for the redevelopment of the former Tweed Hospital site, creating 800 high-density units.

Meanwhile, housing density at the East Lismore housing development on land formerly owned by Southern Cross University has also increased from 400 to 500 homes.

The Minister for the North Coast, Janelle Saffin said Tweed Heads had a "dire need" for housing, with a vacancy rate of 0.8 per cent.

"Tweed Heads is one of the fastest-growing communities in NSW, which has placed immense pressure on local rental and housing markets," she said.

Tweed Mayor Chris Cherry welcomed the creation of more homes but said the state government could do better than allocating just 10 per cent of the development as affordable housing.

"We certainly welcome this commitment by the state government to get housing onto that site. It's prime real estate in Tweed Heads, so to get a residential outcome is a great one," Cr Cherry said.

"It's ideal for affordable housing and getting some of that low-cost, key-worker housing that we really need in the shire.

"I'm hoping, because it's a public piece of land that the community already owns, that maybe we could get something a bit higher than that in terms of affordable housing," she said.

Affordable housing 'negative' value

Landcom's executive general manager of the built form division, Andrew Cooper, said planning was still in the early stages, but confirmed at least 10 per cent of the development would be affordable housing.

Mr Cooper said there needed to be a mix of affordable and market value housing to make the development viable.

"Unfortunately, affordable housing has negative land value,. That's just the nature of the costs in 2026. You need the market housing to effectively support the affordable housing," he said.

Teresa Mitchell, the founding director and CEO of AGAPE Outreach, was disappointed there was no social housing included in the development.

"The fact that there's no social housing is kind of sad. We've got sole parent pensioners, we've got people on disability payments, we've got youth, so not having any social housing is just not going to cater for any of these people.

"There are so many in this area in need of housing. We need housing, we really do. But, it's just not going to cater for the people who live here."

The State Significant Development Application for the Tweed Heads development will be lodged in early 2027 with construction expected to commence in 2029, pending planning approvals.

Meanwhile, the construction of 50 rent-to-buy units in East Lismore by Landcom was on-track for occupation by February, Mr Cooper said.

Next door, the state government has added an extra 100 homes to the 400-lot being developed by Landcom as part of the Reconstruction Authority's Resilient Lands Program.

Funding will also be provided to support infrastructure upgrades, such as water and sewerage, as required.

The first lots will be available for people relocating from homes bought back by the Reconstruction Authority as part of the Resilient Homes Program.

The retail sale of around 100 lots was expected to begin in October, and will be released over five years.