An ACT parliamentary inquiry looking into the problems with the development application process in Canberra is holding its first public hearings this week.

Representatives from residents groups and community councils from across the city lashed the current planning approvals system as opaque, complex, and stacked too heavily in favour of developers.

Kingston Barton Residents Group spokesman Peter Moore said flawed DA processes had eroded members' confidence in a "crucial mechanism of government".

He said  group recently requested plans for a DA that were completely unreadable, so they went to the planning directorate to look at the plans they had on file, only to discover they were illegible too.

"The government made a decision on a critical DA without actually being able to read the plan. We were astounded," Mr Moore said.

Griffith Narrabundah Community Council president Dr Leo Dobes said his group recently found a wrongly ticked box on an application that falsified the plot ratio of the development.

"One of our committee members was able to spot the mistake in 10 seconds and it had gone through the planning process and been approved," Dr Dobes said.

However Christine Gingell of the Friends of Hawker Village group said the review process made residents feel like they were in an "uphill battle and the situation is unfairly stacked against you".

Ruth Cully of the Hughes Resident Association said the system had "perverse incentives", which failed to penalise people for putting forward incomplete or incorrect information.

"We don’t have the funding and the resources to operate as a kind of organised scrutineer of every development application that gets put up," Ms Cully said.

Dr Dobes said a recent case where a developer put forward a DA that was exempt and amended it, which does not trigger the requirement to notify interested parties under the current system.

"The developer knows they can put forward an acceptable DA, and then amend it later and the community will never find out about it nor can they appeal it. Developers know the rules, they can game the system," Dr Dobes said.

However advocates for the property sector say the opposite is true.

Master Builders ACT chief executive Michael Hopkins said the low barrier to lodging an appeal meant anyone could hold up a project if they wanted to.

He said third party appeal rights should be cut back to cases where the development proposal was significantly different from the territory plan or master plan, or where the planners had failed to properly assess the impacts of the proposal.

"It costs about $200 to lodge an appeal in ACAT. It can be open to abuse by vexatious stakeholders who are sometimes commercial competitors or it can simply be used to delay a development proposal by the objector in the hope that a 12-month delay will lead to the project being unviable and often that's successful," Mr Hopkins said.

"If consultation is carried out early in the process and DAs are approved in accordance with the resulting planning rules, we don't believe third party appeal rights should apply.

"Likewise, if the planning authority uses its discretion to approve a development with an alternative or innovative solution, third party appeal rights shouldn't apply, the judgement of the planning authority should be supported."

However Mr Hopkins acknowledged the planning authority needed more resources.

"At the moment we're seeing a large [amount] of development activity. I'd say the sheer resources in the planning directorate haven't kept up with that and government would do well to provide more resources in the development assessment areas so they can keep up with that and properly administer the planning laws," Mr Hopkins said.

Property Council ACT executive director Adina Cirson said there was an "urgent need" for more resources in the planning directorate.

“We do have confidence in planning officials to make good decisions for our community and for our members but time is money and delays to planning approval processes ultimately result in poor outcomes and worse quality," Ms Cirson said.

The Property Council was also scathing of third party appeal rights in its submission, saying the threat of ACAT costs - sometimes in the hundreds of thousands of dollars - was a "disincentive" for innovative design.

“We are finding our members need to have contingencies anywhere from $200,000-$300,000," Ms Cirson said.

"One member told me last week they had a contingency of $5 million to safeguard against third party appeals. We do think it’s time to look at that system and see if we can get some better outcomes for that."

Housing Institute of the ACT executive director Greg Weller said the criteria for exempt developments should be widened to prevent "unnecessary delays" through consultation and third party appeals.

"The housing industry is concerned that the consequences of an underperforming approvals process is not being recognised, and the commensurate level of resources therefore being provided by government is less than adequate," Mr Weller wrote in his submission.

The inquiry continues on Thursday.