Housing crisis

Housing crisis worsens as Sydney councils prepare to miss new housing targets

Peter Tulip, chief economist at the Center for Independent Studies, said repeatedly failing to meet new home delivery targets is worsening the housing affordability crisis.

“As a rule of thumb, each 1% increase in the housing stock, holding other items unchanged, should reduce the cost of housing (both rents and prices) by about 2.5%,” he said. declared.

Last year the NSW Productivity Commission estimated a shortfall of 170,000 homes – around 5% of the NSW housing stock – by 2038, which Tulip said would add 12.5% ​​to the cost of housing.

Although expected to fall short, many councils such as Parramatta and Ryde have exceeded previous housing targets. Parramatta Labor Mayor Donna Davis said the council was on track to deliver 87,900 homes by 2036.

‘Western Sydney does the heavy lifting when it comes to accommodating Sydney’s growing population – including the town of Parramatta – but the burden must be shared across all local government areas,’ she said .

Ryde Liberal Mayor Jordan Lane said he did not want the council to “subsidize the responsibilities” of other Sydney councils.

“Ryde has done more than its fair share of the heavy lifting when it comes to housing supply,” he said. “It’s time we developed a backbone and stopped giving in to big developers.”

Randwick councilors voted last week to underscore their opposition to comprehensive housing targets set by the state government, even though Labor Randwick Mayor Dylan Parker said: ‘Our community is already in good shape. way to achieve its goals.

Parker accused the developers of “bashing the councils” and said the demands to remove planning powers were “nothing less than a brazen power grab by a vested interest group”.

“Bypassing communities and accelerating development in the name of affordability strikes me as a recipe for disaster, he said.

A spokeswoman for the City of Sydney said the council’s own data showed it was on track to meet long-term and short-term housing targets.

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Urban Taskforce chief executive Tom Forrest said the continued shortfall in housing supply was mainly the result of poor planning.

“It starts with quickly rezoning land and freeing up additional residential areas in the right places – areas where people actually want to live,” he said.

Forrest said housing affordability will deteriorate once migration picks up: “Without an increase in supply, this could undermine the Reserve Bank’s strategy of mitigating rising house prices with rising rates. of interest.”

Gabriel Metcalf, chief executive of the Sydney Committee, said the failure to meet housing targets was the “smoking gun” that showed the planning system needed reform.

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“In terms of housing goals, there’s no need to be dramatic about it,” he said. “Either local governments achieve their goals, or the state intervenes.”

Research by the Committee for Sydney has suggested that the city could fit up to half of its population growth within walking distance of underground and heavy rail stations.

“We all know Sydney is overpriced,” Metcalf said. “It creates a generation gap and prevents young people from owning property if they are not lucky enough to inherit the wealth.”

A spokesperson for the planning department said it was important to increase housing supply and affordability, but “it is far too early to call on councils for not meeting their new housing targets lodging”.

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“Each council’s current zoned housing capacity is being assessed, along with the planned housing pipeline over the next six to ten years, and monitoring for the first year is just beginning,” it said. he declares.

The New South Wales government was also spending $3 billion on 378 infrastructure projects which “will mean more homes can be built”, he said.

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