Although December 2024 saw a monthly increase in housing approvals, the annual data reveals a concerning shortfall in New South Wales, according to Tom Forrest (pictured above), CEO of the Urban Taskforce.
"While the December data shows growth in apartment approvals, the annual total number of approvals is languishing in NSW at just below 43,000 per year, and that is about half of what is needed to deliver the Housing Accord target for New South Wales," Forrest said.
In response to the housing shortfall, the introduction of the new Housing Delivery Authority (HDA) by the Minns government has been a critical development. This initiative aims to enhance the delivery of new homes through a streamlined planning pathway, promising to build on previous policy reforms aimed at increasing affordable housing.
“The benefits of this new pathway will build on the successful infill affordable housing bonus policy reform over the next year or so, but to date, this has not flowed through to the data,” Forrest said.
The early adoption of the HDA has shown promising results, with nearly 100 expressions of interest submitted for 40,000 new homes in its first month.
Additionally, a bipartisan review of the NSW Environmental Planning and Assessment Act suggests a growing political consensus on the importance of boosting housing supply.
2024 was a challenging year for the property development and construction sectors, marred by poor feasibility for new housing projects and compounded by the imposition of affordable housing levies on every planning reform.
However, the HDA process introduces a new model where the private sector provides financially viable proposals, a method that has gained popularity.
“The new HDA process is different. It calls for the private sector to tell the government what they think might be financially affordable (with evidence) – and this approach has proven to be popular,” Forrest said.
With potential interest rate reductions on the horizon, there is optimism that both planning and macroeconomic settings are starting to shift favourably. Forrest suggests that these changes could gradually align to foster a more conducive environment for meeting housing needs.