Housing Industry Association president Glen Dowse, though, urged caution, saying the proposal to allow dual occupancy on Fluffy blocks would bring massive change to some suburbs.

"My personal opinion is that this blanket policy is the wrong way to go, it should be based on better planning principles and we should be looking at corner blocks and blocks over 900 square metres, which would have less impact in an RZ1 area," he said.

"It shouldn't be done on a political whim. It should be done on good planning principles. We've had too much political whim in planning in the city, with bad results. It's got to stop somewhere."

The ACT government has called for public comments on its change to the Territory Plan to allow the 780 Mr Fluffy blocks over 700 square metres to be subdivided for two homes and sold as separate titles.

Under current rules, suburban blocks must be at least 800 square metres before dual occupancy is allowed, and even then the two homes can't be sold as separate titles. Buildings can cover no more than a third of the block. The new Fluffy dual occupancies will allow buildings on up to 50 per cent of the block if both homes have street frontage and 35 per cent otherwise.

The change is designed to increase land values, helping the government recoup some of the enormous costs of the buyback of the asbestos-contaminated homes.

Property Council chief executive Catherine Carter said the government should consider allowing dual occupancy across the ACT. For many years, dual occupancies had allowed people to "age in place in their suburb and to remain close to shops, medical facilities, friends", but the government had stopped them in 2003, because of problems mediating disputes between owners. Now it had recognised "this is not such a great problem", dual occupancy should be back on the agenda, she said.

The Housing Industry Association is yet to make a formal response, but Mr Dowse said personally, while "all for development" and understanding the need for a return on the Fluffy blocks, he was concerned about the approach. "The Labor government got elected on a platform of stopping dual occupancies, and [Simon] Corbell rode to power again and again on that platform, so it's convenient for them to change their mind when they need to do some redevelopment work, but for the last 10 years they have put policy in the way of development in our suburbs," he said.

There was room to densify in the core of suburbs, in RZ2 zones, without eroding the RZ1 zone, he said.

He also doubted calculations on the expected increase in value through dual occupancies, saying if the cleared blocks were sold as single blocks under current rules they would sell for much more than unimproved value – given their location in

Master Builders ACT executive director Kirk Coningham said he supported the attempt to "extract opportunities" from the Fluffy buyback. Dual occupancy allowed higher density in established suburbs and gave older people the option to downsize. But he supported the Property Council's call for a wider change, including the possibility of four, six or even eight dwellings on blocks of 1000 square metres or more.

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