Today’s announcement by the NSW Premier of housing targets for 43 local councils is a welcome step to help the NSW monitor and deliver against its agenda to deliver 377,000 new over the next 5 years.
The announcement included $200m in financial incentives for Councils to spend on public amenities such as road infrastructure or parks where they meet or exceed new housing targets.
“The NSW Government has set itself an ambitious target to deliver 377,000 new homes by 2029. UDIA has long called for council-by-council targets to help give communities and the development sector greater certainty about where new houses will be built. Public reporting against these targets is also critical to ensure transparency against delivery,” said Stuart Ayres, CEO, UDIA NSW.
“The announcement of financial incentives for councils is a positive step, as we know enabling infrastructure is critical to enable housing to be built. However, while the targets are important, they must focus on housing completions not just how much land has been zoned or the level of development application activity.
“Developers are facing some of the worst economic conditions in which to deliver housing in a generation. Crippling construction costs and increased financing costs are making it harder to bring an apartment to market at a cost purchasers can afford and financiers will fund,” he said.
In fact, recent research of UDIA members showed 50% of apartment projects that have development approval are unable to commence construction because they are unable to be financed.
Mr Ayres said in addition to tracking Councils performance on development application and rezoning activity, it would be critical to track and improve the time taken between approvals being granted and construction commencing.
“Where projects are feasible, we know that it can take up to 18 months to get a construction approval. It is no good getting an application approved if developers have to wait this long before construction can commence,” said Mr Ayres.
With apartment feasibilities under huge pressure, UDIA has welcomed the fact councils across greater Sydney, Hunter, Central Coast, Illawarra and Shoalhaven have been given targets.
“We know that many of the current planning reforms announced will not result in huge number of housing being built in the short term, due to the current economic headwinds. If we have any hope of getting out of the housing crisis, we need an acceleration of housing completions in all regions and across all housing types – infill, high-rise, low-rise, medium density and greenfield housing,” said Stuart Ayres.
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Media enquiries: Deanna Lane, Director Media & Communications NSW and National 0416 295 898 dlane@udiansw.com.au