Trish Macdonald, Joss Haiblen and Ian Ross say co-housing is the perfect middle ground to downsize from their inner-north family homes without entering apartment living and giving up their backyard.

The trio formed Stellulata Co-housing and submitted plans for their communal living concept to the ACT government's Demonstration Housing Project in 2019.

The ACT government project asked developers to bring ideas not currently allowed under planning laws, prioritising sustainability and to provide more accommodation choices.

Draft variations to the Territory Plan have been released for consultation, for both the Ainslie co-housing concept and a manor house in Griffith, which would allow four units in a two-storey building.

Both proposals will "test and evaluate" the concept and could influence future policy.

Stellulata plan to build three units and a communal kitchen and living area on a 1090 square-metre block at 24 Angas Street.

Mr Ross says he isn't really downsizing at all.

"If you count my unit, which I've got exclusive access to, and [the communal] space ... it's almost the same size as the house I've got," he said.

Sustainability was key to be part of the Demonstration Housing Project. Ms Macdonald said the site would be entirely solar-powered, have underground water tanks to fully service the garden, and two electric vehicle parking spaces.

The plan, tipped to cost $3 million, includes three self-contained units with individual courtyards behind a large communal kitchen and living area with a guest bedroom upstairs and double garage. A large garden will run almost the length of the block.

The trio want the venture to become part of the community, with a kerbside vegetable garden and the opportunity to host events in the communal area.

"We're putting the vegetable garden in the front, because when you're in the garden, that's when you meet people who are walking along the street," Ms Macdonald said.

"It's really an interconnecting point, but people don't spend time there."

Mr Ross admitted co-housing wasn't for everybody but believed the concept could suit everyone from young families and professionals to retirees.

"If it's open to large blocks in other suburbs, you know, it could become a very cost effective way to live, especially if you're coming from a house in one of the inner suburbs," he said.

They say planning rules in Canberra need to change and hope their project will start a chain reaction.

"We think this is an example of what you can do to increase the density of housing in the inner suburbs [that] it fits in very well with the established houses," Mr Ross said.

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They hope to go to tender by the end of the year with construction expected to take six months.

Plans to vary the Territory Plan for a 'Manor House' in Griffith have also been released.

The build on Blaxland Crescent, Section 31 Block 6, would appear as one large house but include up to four units across a maximum of two storeys.

The draft variation plan is to allow a manor house on the block opposite St Edmund's College, including a basement beneath the two-storey structure and include a criteria that the frontage must appear as two storeys.

According to the documents, the development would fit in with the character of the surrounding area because it will have the "look and feel" of one large house.

The variations for both projects are open for public consultation until April 16.

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