Tomorrow’s NSW budget provides a critical opportunity to build on the recent momentum and consensus that the private and public sectors need to work together to deliver the 378,000 being NSW’s share over the next five years under the National Housing Accord.
“UDIA recognises the dual challenge of tackling the housing supply crisis currently gripping NSW, while balancing a budget that is forecast to remain in deficit for some time. Business needs new workers, so immigration is fuelling a new demand for housing which must be met.
UDIA has provided government with a number of considered recommendations which if delivered, would boost housing supply, lift productivity and with the huge economic multiplier from development, also have a positive impact on the NSW budget bottom line in the medium term,” said Steve Mann, CEO, UDIA NSW.
Delivering the Housing Accord will be a monumental effort and we will need to outperform in all types of housing – apartments, detached houses and medium density – and across the length and breadth of NSW. As well as making the planning system more efficient and cutting red tape, we must also ensure critical infrastructure like roads, schools, water, power and sewer are delivered on time and on budget. That’s why many of recommendations for next week’s budget focus on ways to improve the co-ordination of enabling infrastructure and land use planning and reduce delays from red tape to enable timely housing delivery.
Our current trajectory for housing supply in NSW is down by 36% from the peak in 2018.
As the tables below show we need a ‘hockey stick’ shaped turn around to begin to chart our way back to the Accord target and in the next few years greenfield markets will need to outperform, whilst apartment projects need approvals now but will take more time to deliver new dwellings.
The less supply we achieve in the next few years, the higher the handle for the ‘hockey stick’, we will need above record levels to reach the 5year supply target!
Source: Oxford Economics & UDIA NSW
UDIA’s Housing Crisis Action Plan outlined 13 priority actions for Government which have the potential to put us on track to meet the ambitious Accord target. Many of these actions require no direct investment by Government, in fact with the right policy settings in place, we could create opportunities for the development sector to contribute and build some of the enabling infrastructure well ahead of when Government could otherwise deliver it,” said Mr Mann.
This approach is a winner for all concerned – it brings forward vital infrastructure which is holding up new housing and by building it sooner, the government and the community pay less overall, while reaping the benefits earlier.
Key recommendations from UDIA’s pre-budget submission include:
- Providing more funding to improve the planning system, including resources to fast-track DA assessments, and better support the Urban Development Program which will better coordinate infrastructure delivery for new housing and apartments;
- Set up a whole-of-government framework for Works in Kind to allow more developers to build key roads and local infrastructure and bring forward infrastructure delivery;
- Deliver an investment into the Housing and Productivity Fund to kick start delivery of enabling infrastructure which could be repaid in future years when developer contributions are made;
- Extend the low-cost loans initiative to let more councils borrow to forward fund investments in local infrastructure and review the lending guidelines which prohibit large councils from borrowing to forward fund vital community infrastructure ahead of development contributions being levied;
- Make the biodiversity system work better by taking a more strategic approach to environmental land use planning, simplifying the bio-certification pathway and investing in more biodiversity credits supply, including through restoration of private and public land.
Our recommendations if implemented, provide a responsible pathway for Government to meet their dual objectives of balancing the budget and tackling the housing supply crisis. Link to our Pre-Budget Submission
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Media Enquiries:
Deanna Lane 0416 295 898 or dlane@udiansw.com.au