Home/Selling/RZ1 and RZ2 zoning guide
Canberra planning guide · Updated November 2026
On 1 July 2026 the ACT Government changed the Territory Plan for RZ1 and RZ2 blocks. Duplexes, townhouses, terraces and low-rise apartments are now allowed on ordinary suburban blocks. This guide explains the new rules in plain English, and what they could mean for the value of your block if you are thinking of selling.
What changed
"Missing middle" housing is the gap between a single house on a big block and a tall apartment tower. Think duplexes, townhouses, terraces and small walk-up apartments. For decades the Territory Plan made this kind of housing very hard to build in Canberra's suburbs.
That changed with Major Plan Amendment 04 (MPA-04), Missing Middle Housing Reform. The Planning Minister approved it in May 2026. It passed the Legislative Assembly in June and commenced on 1 July 2026. A new Missing Middle Housing Design Guide took effect on the same day.
RZ1 Suburban zone
RZ1 is Canberra's standard suburban zone. Most detached family homes sit on RZ1 land. Before July 2026, a second home was only allowed on blocks of 800m² or more, with a maximum of two dwellings. That limit has gone.
| Rule | Before 1 July 2026 | Now |
|---|---|---|
| Housing types | Mostly single homes. Dual occupancy on larger blocks only. No apartments. | Duplexes, triplexes, townhouses, terraces, co-housing and apartments up to 2 storeys |
| Minimum block for 2 or more homes | 800m² (700m² for a surrendered block) | No minimum block size |
| Maximum dwellings | 2 per standard block | No fixed cap. Density is guided by the technical specifications and site context |
| Height | 2 storeys | 2 storeys (an attic within the roof is generally allowed) |
| Site coverage (multi-unit) | 45% | 45% (unchanged) |
| Subdivision | Block subdivision not permitted. Unit titling above 800m² only | Permitted where each block has a lawfully built home or is at least 350m². Unit titling on standard blocks of 600m² or more |
| Block consolidation | Supportive housing only | Permitted where it results in more dwellings. Guidance limits of 2,000m², 2,500m² or 3,000m² by location |
| Granny flat | Blocks of 500m² or more | No minimum block size. Max 90m², one per block |
The government's own example: three neighbouring single-house blocks can only be consolidated if the new combined block will hold four or more homes. Consolidation has to add housing.
RZ2 Suburban Density zone
RZ2 blocks usually sit around local shops, group centres and main transport routes. RZ2 was called Suburban Core. The reform renamed it Suburban Density, which tells you the intent: more homes, closer to services.
RZ2 already allowed more housing than RZ1, but few owners used it. Since an earlier upzoning in 2003-04, about 85% of RZ2 blocks were still single houses. The new rules make redevelopment more practical.
| Rule | Before 1 July 2026 | Now |
|---|---|---|
| Housing types | Low to medium density, with tight limits | Mainly low-rise multi-unit housing or compact single homes |
| Height | 2 storeys | Multi-unit: 3 storeys (plus attic). Single homes and granny flats: 2 storeys |
| Minimum block for 2 or more homes | 700m² | No minimum block size |
| Maximum dwellings | 1 extra dwelling per 250m² over the minimum | No fixed maximum |
| Site coverage (multi-unit) | 45% | 45% (unchanged) |
| Subdivision and consolidation | Permitted | Permitted (unchanged) |
Side by side
| RZ1 Suburban | RZ2 Suburban Density | |
|---|---|---|
| Typical location | Most suburban streets | Near shops, centres and transport |
| Missing middle housing | Permitted | Permitted, with more scale |
| Apartments | Up to 2 storeys | Up to 3 storeys |
| Minimum block for multiple homes | None | None |
| Fixed dwelling cap | None (density guidance applies) | None |
| Multi-unit site coverage | 45% | 45% |
| Subdivision | Yes, with a built home on each block or 350m² minimum | Yes |
| Granny flat | Yes, max 90m² | Yes, max 90m² |
| 50% LVC reduction | Eligible projects | Eligible projects |
Search your address on ACTmapi, the ACT Government's free mapping tool, and turn on the Territory Plan zones layer. It also shows block size, heritage, bushfire and other overlays. Your Crown lease matters too. It sets how many dwellings are allowed now, and changing that number needs a lease variation.
Subdivision and titles
Yes, which is one of the biggest changes. Under the updated Subdivision Policy, you can subdivide an RZ1 block into more blocks if:
The built-home rule is there to discourage land banking. The government wants new homes, not just new vacant lots.
Unit titling keeps one block but creates a separate title for each home, with shared common property. It is allowed once all the homes are lawfully built, on a standard block of at least 600m² (or a non-standard block). The old 120m² size limit on the second home is gone. Staged unit titling is not allowed for fewer than 5 units.
Separate blocks (often called torrens titles) give each home its own block with no body corporate. Buyers often prefer this, so it can affect resale value.
A granny flat can never be separately titled or sold on its own. It always stays with the main house.
The October 2026 Planning Act changes mean small subdivisions and consolidations are no longer treated as significant development. Assessment drops from 60 working days with two rounds of notification to 30 to 45 working days. A lease variation that only changes the number of dwellings can go through a 10 working day pathway. You still need a development application for the design and siting of the new homes.
Secondary residences
A secondary residence (granny flat) is a small second home that stays on the same title as the main house. Many families use one for ageing parents, adult children or rental income.
Costs and charges
If you add dwellings to a lease, you usually pay a Lease Variation Charge (LVC). For most Canberra leases it is a set amount per extra dwelling. The codified rate is $49,000 per additional dwelling from 1 July 2026. Some leases use suburb-based rates instead, which vary widely.
Eligible RZ1 and RZ2 developments get the charge halved. The government's conditions are:
This is general information, not tax, legal or planning advice. Confirm charges with the ACT Revenue Office and a planning professional before you commit.
Your block, your options
The rules are now more flexible, so the block itself decides more. These are the common options.
Lightest touch
Up to 90m², stays on one title. Good for family living or extra income.
Two homes
Two homes on one block, unit titled or subdivided into two blocks.
Three or more
A row of homes with their own entries. Needs a licensed developer for 3 or more.
Bigger sites
Combine blocks to fit more homes, within the size limits for your location.
Block review
Send us your address and we will run a quick review of your block under the new RZ1 and RZ2 rules. There is no cost and no obligation.
The review is general information to help you plan. What you can build is always subject to town planning, design and approval. For a firm answer, you will need a town planner or building designer.
Mac will review your block and send your report, usually within 2 working days. If we need anything else, we will call you.
Thinking of selling sooner? Book an appraisal.
Real Canberra examples
Two RZ2 blocks our team has worked on show how builders and developers look at these sites. Both are large blocks with room for more than one new home.
For sale now · Holt
1,005m² blockRZ2 zonedTenanted at $620 per week
A development approval was previously granted for two four-bedroom homes. It has since lapsed, so a buyer could lodge a new application for two homes, or for three. Concept plans for three four-bedroom homes are available (subject to approval).
The existing home is leased, so a buyer has rental income while they plan. Close to Kippax Fair, schools and transport.
See the property
Just sold · Monash
1,125m² blockRZ2 zonedSold
A development application was lodged for four four-bedroom homes on this large RZ2 block. The renders showed buyers exactly what the site could become, and that potential drew builders and developers as well as home buyers.
Own a large block in RZ1 or RZ2? We can show you who your buyers are and what they will pay.
Review my block
Sold by Steve Lowe
Development potential is always subject to approval. Renders are from the development application for 23 Axon Street. Buyers should make their own enquiries and get independent planning advice.
For sellers
The reforms widened the pool of buyers for many suburban homes. A family home on a good RZ1 block can now appeal to owner-occupiers, families who want a granny flat, builders and small developers. More competition can mean a stronger result. It does not mean every block is suddenly worth more. The block's size, shape, location and condition still drive value.
Our team has sold hundreds of Canberra homes, including many on large suburban blocks. Steve Lowe also came to real estate from the building trade, so he can talk a builder's language about what a site can really hold.
Questions
RZ1 is the Suburban zone in the ACT Territory Plan. It covers about 79.7% of Canberra's residential land. Since 1 July 2026 it allows missing middle housing, such as duplexes, townhouses, terraces and apartments up to two storeys.
RZ2 is the Suburban Density zone, previously called Suburban Core. It usually sits near shops and transport. Multi-unit housing can be up to three storeys, and there is no fixed cap on dwellings per block.
Yes. The old 800m² minimum block size for a second home was removed on 1 July 2026. Your design still has to meet the Territory Plan, the technical specifications and the Missing Middle Housing Design Guide, and you need development approval.
Each new block must be at least 350m², unless each block already has a lawfully built home on it. Unit titling is allowed on standard blocks of 600m² or more once all homes are built.
There is no fixed cap any more. The number depends on density guidance in the technical specifications, plus site coverage, open space, tree canopy, parking and setbacks. In practice, block size and shape decide it.
RZ1 allows two storeys. RZ2 allows three storeys plus an attic for multi-unit housing, and two storeys for single homes and granny flats.
No. The 500m² minimum was removed. A secondary residence is limited to 90m², one per block, and stays on the same title as the main house.
Eligible RZ1 and RZ2 developments that add dwellings get a 50% reduction. The LVC must be deferred on or after 10 June 2026, development approval must be granted before 30 June 2029, and all dwellings must be finished by 31 December 2030.
No. Heritage, bushfire, flooding and other controls still apply to RZ1 and RZ2 blocks.
It can, if your block suits more homes and builders compete with owner-occupiers for it. Many blocks will see little change. A tailored appraisal is the best way to find out what your block is worth to every type of buyer.
Thinking of selling?
Book an appraisal and we will look at your home through the new rules: who your buyers are, what they will pay, and the best way to sell.
Book an appraisalImportant: this guide is general information only, based on public ACT Government sources as at 6 November 2026. It is not planning, legal, tax or financial advice. Rules can change, and every block is different. Before you buy, build or subdivide, get advice from a qualified town planner, building designer or solicitor, and check your Crown lease.
