NSW Housing Crisis Showing No Signs of Easing Anytime Soon

Planning Minister Paul Scully has admitted there is no quick fix.
NSW Housing Crisis Showing No Signs of Easing Anytime Soon
A general view of apartments in the suburb of Zetland in Sydney, Australia, on Sept. 7, 2022. Lisa Maree Williams/Getty Images
Jim Birchall
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The housing crisis in New South Wales (NSW) is showing no signs of abating with demand outstripping supply, and Planning Minister Paul Scully has admitted there is no quick fix.

A growing population means NSW will need 377,000 homes within the next five years to be on par. However, last year, only a little over 48,000 homes were completed, well below the 59,000 completed in Victoria.

The housing shortage is also impacting on a national level. As part of Labour’s federal budget on Oct. 25, Treasurer Jim Chalmers announced a national plan to build one million energy-efficient homes in five years by 2029.

Compounding the issue and stymying growth are slow development application processing times, which are on average taking 116 days to be processed by relevant local councils.

There is a further difficulty for those seeking rental accommodation, with the housing crisis responsible for an increased rent of 24 percent on units and house rents by 11 percent as of September 2023. House prices in Sydney have ballooned to 14 times the average income.

The Minns Labor government’s new reforms, organised in tiers, propose to accelerate precincts for re-zoning to deliver up to 47,800 “new, well-located, high- and mid-rise homes over the next 15 years,” according to the NSW Government Planning Department.

A report has identified eight Sydney transport hubs for accelerated rezoning by November this year, including Bankstown, Bays West, Bella Vista, Crows Nest, Homebush, Hornsby, Kellyville, and Macquarie Park.

These suburbs will all undergo rezoning by November 2024 to provide significant uplift and support new homes within 1,200 metres (3,900 feet) of these metro and rail stations.

A new State Significant Development pathway targeted towards big-ticket developers with proposals of $60 million (US$40 million) or more aims to ease the red tape around construction. New developments will be required to start within two years of approval.

Affordable housing held in perpetuity will make up to 15 percent of homes in these locations to ensure essential workers like health workers, teachers, and hospitality workers can live closer to work.

Mixed-use residential with different housing types will be promoted, at odds with local council guidelines on density. The NSW government said they are setting the expectations for councils so that more homes of different types are built in areas close to transport.

Currently, each local council has its own rules for what kind of homes can be built in their area. Mostly, these rules don’t allow the types of homes that can add density to local town centres and transport hubs.

Under the plan, councils are unable to object to the building of certain building types which include terraces, residential flat buildings, manor houses, duplexes, and semi-detached houses.

The NSW government has an overarching power over a local council, whereby if a council changes its rules the state’s rules will no longer apply.

NSW Premier Chris Minns ruled out the NSW Government building 75,000 houses this year. (AAP Image/Dean Lewins)
NSW Premier Chris Minns ruled out the NSW Government building 75,000 houses this year. AAP Image/Dean Lewins
Planning Minister Scully told reporters he was unable to say if the new reforms, which include the speeding up of approvals and changes in density requirements, would expedite new builds and ease the housing crisis.

“A reasonable person would say ‘let’s allow those reforms: one, to be bedded down and two, for the industry to gear up,’” he said.

Premier Chris Minns had earlier ruled out the state playing catch-up, which would require the building of 75,000 houses in a year.

While expectations are that builds will not meet needs, Mr. Minns did say he favoured a “major increase” in new builds in 2024.

“Some of our reforms are going to make sure that we’re not only delivering housing in the immediate term but we’re delivering them long into the future,” Mr. Scully said.

“That’s the sort of reform that NSW needs.”

Jim Birchall
Jim Birchall
Author
Jim Birchall has written and edited for several regional New Zealand publications. He was most recently the editor of the Hauraki Coromandel Post.
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