Image: NSW Government
The debate over how Mosman handles the state government's housing mandate has entered a new phase. After receiving a large amount of community feedback during its April and May 2026 consultation period, the council has moved away from two proposed masterplan options – both of which involved increased building heights along the Spit/Military Road corridor – and is now pursuing alternative approaches that still aim to deliver around 4,700 new homes.
This is a change in the ongoing dispute between Mosman Council and the New South Wales government over how much and what kind of new housing the suburb must absorb. The state's Low and Mid-Rise Housing Policy (LMR), which took effect in February 2025, allows developers to build at heights and densities that override the council's own planning controls across much of the Local Government Area (LGA). Council has been fighting for a local alternative.
That fight was formalised in December 2025, when Mayor Ann Marie Kimber secured unanimous council agreement to develop a long-term strategic masterplan. The state government agreed to consider it as a possible framework for how the LMR is applied in Mosman.
Where do things stand?
The community consultation that opened on 28 April 2026 was extended to 24 May after the volume and strength of feedback made it clear the two original options did not have community support. These options were to concentrate taller development tightly along Military Road and Spit Junction, or distribute growth more broadly at lower heights.
The council is now working on alternative approaches that keep the same dwelling target while avoiding the height outcomes that residents objected to most. The final masterplan is expected to take around two years to finalise.
The NSW government has not budged on the fundamentals. The LMR remains active, and any masterplan must match what LMR could deliver, not what the council would prefer. Mosman's own five-year housing target is 500 dwellings. The state's number, based on what the LMR could theoretically unlock across the LGA, is around 4,700. Closing the gap between 500 and 4,700 is the challenge the masterplan has to resolve.
What the LMR means on the ground
For anyone who owns property within roughly 800 metres of Cremorne or Spit Junction/Military Road, the LMR is already active. Stage 2 of the policy, which took effect in February 2025, allows development at heights and densities that override Mosman Council's local planning controls. Properties within 400 metres of a town centre can be developed up to six storeys and those between 400 and 800 metres are subject to four-storey controls.
The pace of developer activity has confirmed how quickly this could play out in practice. When one Military Road site was declared under LMR controls, more than 250 dwellings were proposed within a single week. That’s more than half of Mosman Council's entire five-year housing target, from one site.
The masterplan's limits
Not everything is within the council's power to change, even with a masterplan in place. If the council's plan is ultimately endorsed by the state government, it can set the planning framework for where and how growth occurs in Mosman, potentially redirecting density to more suitable locations and establishing height transitions that respond to local character and heritage.
It can’t, however, undo approvals already granted under the LMR, and it won’t remove the LMR's authority while the masterplan is still being developed.
The council has also identified four council-owned sites as part of the masterplan framework, including the Civic Precinct, the Bowling Club site and two residential development sites on Ourimbah Road and Stanton Road. These offer the council more direct influence over at least some of the new housing the state is requiring.
What does this all mean for property owners?
The planning uncertainty has implications for anyone considering selling in LMR-affected areas. Developer interest in Mosman properties has intensified since Stage 2 took effect, and some owners have been approached with option agreements offering a locked-in sale price in exchange for the right to proceed with development.
But, those agreements might have a catch: the option period can last years, flexibility to sell or change direction is limited and a rising market may outpace the price secured at signing.
The masterplan process adds a further variable, because if the council's alternative approach ultimately redirects development pressure, the numbers around specific sites could change considerably.
For most owner-occupiers, the practical question is not whether to sell to a developer but how the planning changes affect the value of your property, the nature of any development that may occur nearby and the medium-term character of the streets and precincts you live in.
The masterplan’s success will depend on whether the alternative approaches the council is now exploring can satisfy the NSW state government.
If you'd like to understand what your property is worth in the current market, the team at Richardson & Wrench Mosman/Neutral Bay is happy to start with an appraisal. Call us on (02) 9969 7622 or email info@rwm.com.au.