With more affordable and diverse housing options becoming increasingly popular and important, it may be no surprise that the NSW Government has flagged its intention to undertake a review into the assessment and approvals process for Caravan Parks and Manufactured Home Estates (MHE).

Time will tell whether the NSW Department of Planning and Environment's proposed review into the planning and regulatory framework governing these types of developments will bring about long awaited change for proponents and customers of these alternative housing options that provides a more streamlined and certain process. Based on our experience and review of a number of cases that have gone before the Court relating to this type of development, it is clear that there is work to be done in this space to hopefully reduce the same issues arising time and time again in legal proceedings.

Recent legislative changes

In September 2021 there was an update to the Local Government (Manufactured Home Estates, Caravan Parks, Camping Ground and Movable Dwellings) Regulation 2021 (NSW) (Regulation) which, in summary, made changes with respect to:

  • the granting of approvals to operate manufactured home estates, caravan parks and camping grounds;
  • requirements of land, sites, setbacks, roads and utility services;
  • design, construction and installation requirements; and
  • requirements for caravans on camping grounds.

Separately, in November 2021 the State Environmental Planning Policy (Housing) 2021 (NSW) (Housing SEPP) came into effect with the intention of streamlining various affordable and diverse housing schemes through the consolidation of five (now repealed) SEPPs, including State Environmental Planning Policy No 21 – Caravan Parks (SEPP 21) and State Environmental Planning Policy No 36 – Manufactured Home Estates (SEPP 36). Notwithstanding the introduction of the new Housing SEPP, the provisions contained in the former SEPP 21 and SEPP 36 were carried over to the Housing SEPP substantially unchanged.

Overview of existing planning regime

Caravan Parks

In summary, the approval process for development for the purpose of caravan parks is primarily regulated under both local environmental plans (LEPs), the Housing SEPP and the Regulation. While LEPs regulate whether caravan parks are a permitted use on the land, the SEPP outlines the relevant planning considerations that must be taken into account by the consent authority when they are determining whether to grant consent for this land use. This includes a broad range of social, economic and environmental matters that are required to be considered by a local council. This may include the location or character of the land, whether there is adequate low-cost housing in the locality, if there are adequate community facilities and services available and provision for tourist accommodation in the locality of the land.

Consideration as to how many of the proposed dwelling sites in a caravan park will be used for 'short-term' or 'long-term' accommodation must also be given, noting that a caravan park may be used exclusively or predominantly for short-term residents (such as tourists) or for long-term residents, or catering for both.

Manufactured Home Estates (MHEs)

Similar to caravan parks, MHE development proposals are subject to the provisions of the relevant LEP, the Housing SEPP and the Regulation. Additional matters for consideration during the assessment of an application for an MHE includes the MHE's impact on conservation, heritage and waterways, the impact of the installation of manufactured homes on site, whether there are adequate transport services available and also the cumulative impact of the proposed development.

Characterisation of land uses

Numerous decisions of the Court highlight the controversy often surrounding development applications that seek approval for caravan park and MHE development, much of which arguably arises due to the uncertainty underpinning the current planning regime and lack of clear provisions and guidance material indicating where such land uses may or should be considered appropriate by local councils.

It follows that proponents of this development type and local councils charge with assessing such proposals often maintain competing views on the proper characterisation of the proposed development. Unhelpfully, this is in circumstances where the term 'caravan park' is defined in the Housing SEPP and within the Standard Instrument LEP but there is no such definition of MHE to be found.

By way of example, in TMT Devco Pty Limited v Cessnock City Council [2016] NSWLEC 1161 the parties argued over whether the proposal was a caravan park, being a use that was permitted with consent on the land, or whether it was in fact an MHE which was a prohibited use in the relevant zone. The relevant application included an area for caravan parking and RV storage with the remainder to be occupied by 302 dwellings sites upon which manufactured homes would be placed. The court ultimately found that there would be an RV/caravan storage area on the land, this would be 'ancillary' to the use of the site that would have the 'dominant' use as an MHE. It followed that the development proposed was considered to be prohibited on the land and the development application was refused.

Area for Reform

In our view the notable number of cases where the issue of characterisation of these land uses has been called into question demonstrates the need for reform in this area.

Whilst this is not the first time the NSW Government has undertaken a review into the regulation of manufactured homes and estates, caravan parks and camping grounds, proponents of these development types will no doubt welcome any legislative change that may result in greater certainty as to where these land uses are permissible and will be considered appropriate.

The NSW Government advised consultation for a new framework will commence mid-2022, however, this is yet to be announced.

Thanks to Eadie Melloy for her contribution to this article.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.