Specialist disability accommodation (SDA) has density rules for how many people can live in a residence when there are at least two separate dwellings on one parcel of land (i.e. a multi-residential complex). Not all dwellings in a multi-residential complex need to be SDA for these density restrictions to apply.
Read on to find out the key points about SDA density restrictions and where you can go for more information before taking out an SDA loan.
What are the density restrictions on SDA properties?
The density restrictions for NDIS housing are outlined in the National Disability Insurance Scheme (Specialist Disability Accommodation) Rules 2020 legislation. These restrictions vary depending on how many people the parcel of land is designed to house.
If one of the SDA dwellings is designed to house three or more residents, then the density restriction is the higher of the following two numbers:
a) ten, or
b) 10% of the total number of residents in all the dwellings on the land. For example, if there are eighty residents, the maximum number would be eight.
If all of the dwellings on a parcel of land are SDA and are designed to house a maximum of two residents, then density restriction is the higher of the following two numbers:
a) 15, or
b) 25% of the total number of residents in all the dwellings on the land. For example, if there are eighty residents, the maximum number would be twenty.
If all of the dwellings on a parcel of land are not special disability accommodation and are designed to house a maximum of two residents, then the density restriction is the higher of the following two numbers:
a) 15, or
b) 15% of the total number of residents in all the dwellings on the land. For example, if there are eighty residents, the maximum number would be twelve.
How are specialist disability accommodation density restrictions calculated?
The number of residents for the purpose of SDA density restriction calculations is based on the principle of one resident per bedroom. For example, a two-bedroom SDA dwelling is counted as two residents, three bedrooms as three residents, and so on.
It’s important to understand that SDA density restrictions are not affected by which category of SDA property is on the parcel of land; the restrictions apply equally to each SDA design category. They are designed to ensure the safety and quality of life of all residents, SDA participants and support NDIS service providers on a relevant block of land.
Familiarise yourself with fundamental National Disability Insurance Scheme (NDIS) terms relevant to the SDA market
Enrolled dwelling
A new build SDA home or existing dwelling that has been deemed SDA compliant and has been enrolled in the SDA scheme. Every
Eligible NDIS participants
Eligible NDIS participants are people living with disability who require specialised housing and have funding for specialist disability accommodation under their NDIS plan. Participants become the tenants of SDA dwellings and often call the SDA dwelling their ‘forever home’.
SDA providers
An SDA provider is someone who provides specialist disability accommodation. Typically, these include an investor who decides to build SDA properties, an organisation, or a family member of the NDIS tenant.
SDA categories
NDIS homes are built across four design categories to ensure that each dwelling has sufficient provisions to support the NDIS participant needs. The categories are:
1 . Improved liveability
2 . High physical support
3 . Robust
4 . Fully accessible
The benefits of SDA investment
Private investors looking to meet their ethical objectives while diversifying their property portfolio are considering SDA housing as their next investment property.
With funding from the federal government and operating within its own market, an SDA home offers a unique addition to the list of available investment options and may come with sustainable long-term returns.
The high demand for specialised housing remains consistent, as outlined in a recent quarterly report released in the NDIS sector.
An NDIS property allows investors to provide an improved quality of life for Australians with very high support needs or extreme functional impairment while also providing the opportunity to access strong capital growth potential and income returns.
Will SDA density restrictions impact my NDIS property investment?
Property investors understand the positive uplift that an NDIS property may have on their overall portfolio return and the positive social outcomes it creates for the Australian community. What private investors don’t always know is how the density guidelines affect their NDIS investment aspirations.
To learn more about NDIS property investment, including how density guidelines may steer your selected NDIS investment, contact the experts in NDIS loans; NDIS Loan experts provide expertly tailored financial solutions to invest in SDA homes.
