UDIA NSW welcomed the announcements on the weekend by the NSW Government of a pilot to explore ways Government could support private sector financing to increase the supply of new homes.
This initiative may include the State Government potentially acting as guarantor for development loans and Government committing to pre-purchase homes to support lenders pre-sales requirements.
“This announcement is welcome in today’s difficult market where so many projects struggle to get finance or reach the necessary pre-sale levels required by lenders. Our own UDIA NSW research shows that up 50% of apartment projects that are currently DA approved but not under construction are stuck, unable to get the finance needed to start building,” said Stuart Ayres, UDIA NSW CEO.
We are encouraged that government has acknowledged the combination of factors that are slowing construction of homes in NSW including the increased cost of building materials, labour shortages and access to finance.
“We are looking forward to working with the NSW Government as its puts together a financial pilot program to support developers with project financing. This is a concept we proposed in our pre budget submission to government and are very pleased to see the idea being taken up,” said Stuart Ayres.
In a further announcement Minister Scully said the Government will invest $253m on more planners and upgrades to the Government’s planning portal to speed up applications through the System.
These two announcements will improve the efficiency of the system and allow the assessment of more housing applications Improving the planning system was a key priority of National Cabinet in August 2023 and all states and territories agreed the National Planning Reform Blueprint.
A key component of the Government reforms is the introduction of new fast tracked assessment pathways under the affordable housing bonus provisions and Transport Oriented Development SEPP. UDIA’s pre-budget submission called for greater investment in assessment resources and we welcome these new resources being made available.
“Details of these announcements will need to be worked through, but are a step in the right direction when it comes to getting more homes from planned to completed,” said Stuart Ayres.
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