The Cook Government wants to abolish the average lot size rule, cut single-home approvals in half and lift density across Perth’s suburbs. For builders, it reshapes where the work is.
For years, a builder looking at a standard 700 square metre block in a Perth suburb ran into the same wall. The land was zoned R20. It cleared the minimum lot size on paper. But it failed the average lot size test, and so it stayed a one-dwelling block. No subdivision. No second home. No infill.
That wall is about to move.
The Cook Government has proposed abolishing the average lot size requirement for land coded R20 and below. Owners of 700 square metre blocks that currently cannot be subdivided would gain new development opportunities, down from the current effective threshold of around 900 square metres. Because R20 is the most common suburban code across metropolitan Perth, the government estimates the change could make more than 50,000 existing properties eligible for subdivision.
It is the most significant reshaping of the Residential Design Codes since they were introduced in the 1990s, and for builders working Perth’s middle ring suburbs, it changes the map of where projects are possible.
What the R20 code actually means
The R-Codes are the rulebook for residential development in Western Australia. The “R” number is shorthand for dwellings per hectare, so R20 targets roughly 20 dwellings per hectare. It is the code that sits under most standard suburban streets in Perth.
Here is the mechanism that has held infill back. A 700 square metre R20 block clears the two minimum lot sizes needed to create two lots, but it fails the average test, which requires an effective 900 square metres. So it stays a single dwelling block. Thousands of blocks across the city sit in exactly that position: big enough in principle, blocked in practice.
Removing the average requirement is what unlocks them. The block that was one home becomes two.
Faster approvals and less red tape
The subdivision change is the headline, but it is not the only reform.
The government is proposing to cut red tape so that simple residential projects such as single houses, renovations, patios and carports no longer need planning approval at all. For the projects that do still require sign off, the review aims to halve single home approval times from 60 days to 30, and to reduce duplication so the R-Codes are easier to navigate.
For a builder, approval timeframes are not an abstraction. They are holding costs, client anxiety and cash tied up before a slab is poured. Cutting a single home approval from two months to one, and removing approval entirely for a patio or carport, takes real friction out of the front end of a job.
Density, height and parking
The reforms also push gentle density further into the suburbs. Among the changes under consideration, the government is looking at allowing three storeys in R40 areas, up from two, removing minimum parking requirements for apartments and granny flats, and redefining baseline heights in medium and high density areas.
Dropping mandatory parking for apartments and granny flats is a quiet but meaningful shift. Parking minimums add cost and eat into site area. Removing them gives builders and homeowners more room to deliver smaller, cheaper dwellings, which the government frames as a benefit for first home buyers in particular.
The proposals are being shaped by an expert advisory group drawn from planning, local government, architecture and property development, with further consultation to come.
The block that was dead weight for subdivision is about to become a live opportunity.
Why the timing matters
The reform lands against a backdrop the state has been open about. Alongside the announcement, the government released a health check on its Perth and Peel @ 3.5 million plan. It acknowledged that Perth’s annual urban infill rate has been running below the 47 per cent target, but showed an increase from 34 per cent in 2023 to 39 per cent in 2024.
In other words, infill is improving but still short of where the state needs it. Perth has long carried the worst urban sprawl problem of any Australian capital, and the economics of stretching the city ever outward are getting harder to justify. Making established suburbs easier to subdivide is a direct attempt to close that gap without pushing further into greenfield land.
This is part of a broader pattern of WA planning reform. It follows the state’s move to build WA’s pre-approved pattern book of medium density home designs, and sits alongside a construction market where detached house approvals were already climbing. The R-Codes overhaul is the supply side lever the state can pull at the planning layer.
What it means for builders
For builders and developers, the practical implications sort into a few clear buckets.
The first is opportunity in the middle ring. If 50,000 blocks become subdivision candidates, the addressable market for duplex, townhouse and grouped dwelling work in established suburbs expands significantly. Corridors of older R20 housing between five and 20 kilometres from the city become the obvious hunting ground. Builders positioned to deliver two dwellings where there was one, at scale and repeatably, stand to benefit most.
The second is speed. Faster approvals smooth the pipeline. A shorter, more predictable planning stage means less capital sitting idle and fewer projects stalled waiting on a decision. That is a margin and cash flow benefit, not just an administrative one.
The third is product. Removing parking minimums and lifting height in medium density zones opens the door to smaller, lower cost dwelling types. Builders who can deliver efficient, compliant small footprint homes will find more sites where those products stack up. There is a natural overlap here with modular and prefabricated construction, which suits exactly the kind of repeatable, smaller format infill these changes encourage.
The caveat is timing. This is a proposal, not law. The draft changes are due for public consultation later this year, with implementation expected from mid 2027. That is a real runway, and consultation can reshape the detail. Industry bodies including HIA and the Urban Development Institute have welcomed the direction while noting the detail will determine whether the reforms deliver. There has also been pushback, particularly around tree canopy loss and whether low level infill produces the walkable density the state actually needs.
THE GOOD BUILDER TAKE
Rezoning does not build homes. Builders do. But planning settings decide which blocks are even in play, and this reform puts tens of thousands of them back on the table.
The smart move now is not to wait for mid 2027. It is to map the R20 stock in your patch today, understand the proposed rules early, and be ready to move the moment consultation firms up the detail. The builders who map those blocks first will be the ones building on them.
The bottom line
Rezoning and rule changes do not build homes on their own. But they decide the field of play. This reform takes tens of thousands of Perth blocks that were dead weight for subdivision and puts them back in contention.
For WA builders, the play is simple: understand the proposed rules early, identify the R20 stock in your area, and be ready when consultation confirms the detail. It is worth watching as part of the broader construction industry trends shaping where and how Australia builds over the next few years.
Your Questions Answered
It is a proposed overhaul of Western Australia’s Residential Design Codes, the rules governing residential development. The key change abolishes the average lot size requirement for R20 and lower coded land, allowing 700 square metre blocks to be subdivided where roughly 900 square metres was previously needed.
The government estimates more than 50,000 existing residential properties across metropolitan Perth could become eligible for subdivision, because R20 is the most common suburban code in the city.
The draft changes are expected to be released for public consultation later in 2026, with implementation anticipated from mid 2027. Until then, they remain proposals subject to change.
Under the proposal, many simple projects such as single houses, renovations, patios and carports would no longer need planning approval. For projects that still require it, single home approval times would be cut from 60 days to 30.
R20 refers to a residential density of roughly 20 dwellings per hectare. It is the most common suburban zoning across metropolitan Perth and applies to most standard residential streets.
Last updated: July 2026
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This article is intended for general information purposes only and does not constitute legal, financial, or professional advice. Laws, regulations, and industry requirements vary by state and territory and change over time. Builders and trades professionals should seek independent advice relevant to their specific circumstances before making business, legal, or financial decisions.
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