The liveability of human settlements can be defined by performance in three key areas:

environmental quality, neighbourhood amenity, and individual wellbeing.

Environmental quality

The environmental quality (capital) of cities includes those environmental resources that are
contained within the boundaries of an urban centre and from which residents gain benefit. As
such, they are distinct from the natural resources (capital) imported into the region to support the
economic functioning of the settlement and its residents. They include urban air quality, water
quality of urban creeks, rivers, bays and estuaries, levels of contamination of soil and
groundwater, and urban biodiversity (refer to the commentaries on Atmosphere, Land, Inland
Waters and Biodiversity). There continues to be a major deficiency in national, state and
territory, and local government state of the environment reporting in this core topic within human
settlements (for example, see state of the environment reports for the ACT (link is external),
New South Wales (link is external), Queensland (link is external), South Australia (link is
external), Tasmania (link is external), Victoria (link is external), and Western Australia (link is
external)).

Neighbourhood amenity

It is at the neighbourhood scale, where a range of housing (design) and subdivision and
infrastructure (planning) factors intersect (Figure 6), and where success in the creation of
liveable and sustainable communities can be assessed for a set of key performance indicators.
Where housing and neighbourhoods can be planned and designed in tandem, the maximum
potential for innovation and achieving desirable triple-bottom-line outcomes is likely to be
obtained; examples include using energy efficient dwellings to generate electricity and sell
surplus back to the grid, and building water-smart housing, which relies on water sensitive urban
design of the subdivision to derive maximum benefit. In the Australian greenfield urban
development context, master planned communities are seen to offer the greatest prospect for
achieving more sustainable residential development (Delfin Lend Lease 2002). The opportunity
for simultaneously incorporating the range of environmental factors listed in (Figure 6) in a more
integrated and comprehensive manner in master planned communities has been examined in a
study by Blair et al. (2004). That study found that master planned communities, for the most part,
delivered superior planning and design outcomes than would be possible under a traditional
regulatory subdivision. New subdivision planning, however, continues to be dominated by
financial yield over environmental performance, primarily because environment is under-priced
(Miller and Ambrose 2005).

Figure 6: Sustainable subdivisions: the housing neighbourhood nexus