UDIA expresses continued concern at the downward trend developing in new residential builds and today’s data from ABS confirms that this remains a critical issue for NSW.
NSW only saw 47,200 new completions, representing only a miniscule uptick over this period. The key and ongoing concern is that this is 25% below the 63,000 homes that NSW has signed on to deliver, as our fair share of the National Housing Accord over the next 5 years.
Source ABS, UDIA NSW
Similarly, new residential commencements data was released by ABS today and there were 49,200 new commencements in NSW in the year to March 2023, down 20%.
Apartments are a crucial missing piece of the future housing pipeline and yet this key typology is struggling under the weight of economic pressures, comprising fewer than 10,000 of this rolling annual total for the second consecutive quarter, at 72% below its peak.
Recent ABS approvals figures showed a minor increase for one month, which did not indicate that an upward trend is going to be upheld, particularly as new approvals remain well below their peak at just 52,000.
“An increase must be achieved consistently over multiple quarters, in order to deliver a positive turnaround,” said Steve Mann, CEO, UDIA NSW.
The combination of low commencements and low approvals, on top of an already undersupplied new housing market, spells significant stress for the people of NSW. Without new housing supply, the affordability crisis will exacerbate and threaten to become further entrenched in the market.
Our UDIA NSW Housing Crisis Action Plan – June 2023 recommends an important set of levers that must be considered by the NSW Government, now 3 months into their term, to take genuine steps to deliver more housing across the continuum.
There is much to be done to build a development ready pipeline of land, highlighted in UDIA’s Action Plan including:
- Establish a Housing and Infrastructure Committee of Cabinet, chaired by the Premier to coordinate across the many government departments who impact city making.
- Defer the introduction of several new and increased development taxes which will collectively add up to $110,000 to the cost of building a home and nearly $80,000 to an apartment.
- Urgently progress the State Assessed Planning Proposal (SAPP) process for applications made in January 2023 for projects over 1,000 homes in Sydney and 300 homes in the regions.
- Change the planning system to make it quicker, simpler and fairer.
- Fix the Biodiversity Conservation Act to work better both for the environment and for communities who are desperate for more housing supply to be unlocked.
- Get affordable housing incentives right so that they do not disincentivise housing across the continuum, and across the state.
UDIA NSW stands ready to work closely with the NSW Government in the implementation of these important recommendations.
Deanna Lane 0416 295 898 or firstname.lastname@example.org