First tenants prepare to move into Marrickville micro apartments in build-to-rent housing partnership.

Sunlight streams in through floor-to-ceiling windows that look out onto a common terrace and the main street of inner-west suburb Marrickville and beyond.

Ms Fermin surveys the concrete walls and exposed pipes running along the ceiling, finding spots to hang plants. Muted green and ochre cupboards complete the simple design.

"It's an amazing opportunity to be in a new apartment, I've never in my life never lived in a new apartment, or anything new," the occupational therapist says, her eyes welling up.

It doesn't take long for Ms Fermin and her daughter to complete the tour. All up, their studio is about 25 square metres: space for a bed and perhaps a small table and chairs, a kitchenette, and a bathroom.

To make up for the tight living quarters, there are two large communal kitchens, couches and chairs to relax and watch television with other residents, and an outdoor terrace.

The build-to-rent development is a partnership between not-for-profit housing developer Nightingale and Fresh Hope Communities, an arm of Churches of Christ NSW and ACT, which provided the land and paid for the build.

It's a unique model that has attracted attention from state and federal governments eager to find ways to ease the city's housing supply shortage.

Cheaper rent and certainty:

A ballot was held last week to determine who would be the first to call the 54 mini apartments home.

"It was a massive build-up over a really, really long time … and the ballot day itself was really, really emotional," Nightingale chief executive Dan McKenna said.

"Hearing that kind of emotion attached to knowing that they've got a roof over their head, that they've got that security in what the project is offering was fantastic."

One of the big attractions is cheaper rent.

The rent has been calculated at 80% of the market rate for the popular area putting the weekly cost at between $395 and $440.

Applicants had to meet criteria, including a maximum income of $97,000 for singles, $126,000 for couples, and $145,000 for single parents.

About one in five homes are set aside for priority groups including women aged over 55, First Nations people, and essential workers.

Ms Fermin said she would be able to save money for the first time in many years.

"My rent has gone up $150 a week over the past year. Now by moving here, I will be saving $300 a week," she said.

It also gives certainty as residents are guaranteed lease renewals if they continue to meet the criteria.

While it is touted as affordable housing, there is criticism that even with a 20% discount, it remains far out of reach for those most in need.

"For older women, who are couch surfing or sleeping in their car, these rents are not cheap," said Beverly Baker, president of the National Older Women's Network, which is calling for more government-funded public housing based on a percentage of someone's income.

Mr McKenna accepted the criticism as "totally fair".

"I think we're working within the system that is pretty broken at the moment," he said.

The Older Women's Network said that given the tax incentives for Nightingale, it was a "missed opportunity" to provide genuinely affordable housing.    

Demand outstrips supply

For every phone call with good news last week, there were twice as many delivering disappointment.

Mr McKenna said that showed there was a need for more creative solutions to Sydney's housing problems that had seen rents skyrocket and many younger people unable to afford to buy a house.

While there's a strong demand for what Nightingale is offering, the Melbourne-based group has no plans for another one in Sydney yet.

It has been a bruising and costly six years to get to this point.

"I think the first one's always the hardest one," Mr McKenna says.

There was an attempt to heritage-list the disused church on the site and the development application was originally refused.

That decision was overturned by the Land and Environment Court.

In a sign of support, the Inner West Council eventually waived the developer's fee saving them more than $1 million.

Nightingale hopes to be an example to other faith-based groups or local and state governments with under-utilised land in good locations.

NSW Housing Minister Rose Jackson saw potential in the Nightingale model.

"We do want to see more of them," Ms Jackson said. 

"It is disappointing that it's so hard to have projects like that get off the ground in Sydney."

The government's plans to make it easier to get approval for medium-density housing in town centres and close to public transport will help. 

To make future projects like this viable, Mr McKenna said developers needed more certainty and the planning process needed to be cut to just three months.

"To show private developers that … if you tick all these boxes, you will be granted a permit, you will be on your way," he said.

Ms Jackson said the government was trying to expedite the planning process, but three months was not realistic at this stage.

The government is conducting an audit of public land and while the priority will be public and social housing, Ms Jackson was not ruling out build-to-rent partnerships. 

"There may be sites where that outcome isn't possible from a government point of view, but an organisation like Nightingale could take advantage of that."

Embracing shared spaces:

To keep costs down, as well as encouraging connection between residents, the units are based on a German design teilhaus, meaning "part of house", with singles or couples in mind.

It's a bit different for Ms Fermin, whose 12-year-old daughter lives with her half the time, so they're coming up with some creative ways to make the new living arrangement work.

"Some nice pyjamas, so you feel OK walking around in the communal spaces would be important, and some good headphones so you can get into your own zone if you're both in the same space."

Ms Jackson said that style of living was not for everyone.

"I think for a lot of younger people, maybe this isn't going to be their forever home. But it's a really solid step into the property market," she said.

Ms Fermin, who currently lives in a two-bedroom apartment in Newtown, has begun thinking about what to let go of before she moves in.

"You know, so much of the world lives in a much smaller footprint and there's no reason why we can't do that."

Original Story By | Rosemary Bolger