Parts of inner Sydney will be required to triple the number of new homes they deliver over the next five years in a long-awaited and ambitious rewrite of the city’s housing targets that shifts the focus from west to east and aims to address the supply crisis.
Ku-ring-gai’s five-year target has increased from 3000 to 7600, while Woollahra’s has nearly quadrupled from 500 to 1900. North Sydney, the Northern Beaches and Fairfield have all doubled from 3000 to 5900 each.
The local government areas of Canada Bay, Newcastle, Mosman, Inner West and Hornsby also have large uplifts compared to what was already planned or in the delivery pipeline.
The new targets are designed to shift home-building toward infill housing closer to the eastern seaboard, instead of greenfield development on the city fringe. Under the changes, infill is predicted to represent 82 per cent of the state’s new homes, and greenfield 18 per cent.
Premier Chris Minns said the targets would “start to rebalance Sydney”, and while the west would continue to grow, “other parts of Sydney will have to share the load”.
“For a long time western Sydney has accepted overwhelming growth [and] as a result, social infrastructure has had to stretch,” he said. “For some councils with low housing targets and not much incentive to change for a long time, it’ll be a substantial change.”
Minns announces the targets on Wednesday.Credit: James Brickwood
The City of Sydney’s five-year housing target has been lifted from 17,000 to 18,900, or 3780 a year. The Inner West has increased from 5000 to 7800, or 1560 a year, and the annual target for the Hills Shire has more than doubled to 4660. The Sutherland Shire has gone from 760 a year to 1200, and Willoughby from 320 a year to 680.
Only Parramatta had its target reduced, from 4500 a year to 3900. Other councils have little or no change and have effectively been told to keep doing what they are doing.
Some, including Randwick and Strathfield, have unchanged targets but will need to lift housing supply significantly compared to what is in their delivery pipeline.
Minns said in parts of the city’s east and north including Ku-ring-gai, Hunters Hill and Woollahra, 70 per cent of the homes required under the targets would be in addition to developments already in the planning system. In municipalities further west such as Liverpool, Parramatta and Wollondilly, that increase would be less than 20 per cent above the status quo.
Under the new targets, 70 per cent of the state’s 377,000 new homes over the next five years – or 263,400 – are to be built in Sydney. Another 30,400 new homes are slated for Greater Newcastle, 18,000 for Illawarra-Shoalhaven, 9400 for the Central Coast and 55,000 for outer regions.
Of the Sydney homes, 41 per cent will be in LGAs east of Strathfield, 37 per cent in the central LGAs (Blacktown, Canterbury-Bankstown, Cumberland, Georges River, Parramatta), and 22 per cent in the west (Campbelltown, Camden, Fairfield, Hawkesbury, Liverpool, Penrith and Wollondilly).
The housing targets are significant as they provide explicit direction to councils about how many homes they are expected to deliver in their municipality by 2029. Councils have a mixed record on meeting previous targets.
Minns has dangled a carrot for councils with a new $200 million fund to help pay for green spaces and sporting fields in areas that beat their targets. He said councils that contribute to more housing would be rewarded with increased funding for schools and hospitals, paid by state developer contributions.
Opposition Leader Mark Speakman criticised that fund as insufficient, saying it would “not hit the sides” given the increased housing proposed under the targets. “That’s a completely derisory, almost insulting contribution to the cost of housing in NSW,” he said.
The higher targets were broadly welcomed by developer groups and housing advocates. Melissa Neighbour, a spokeswoman for Sydney YIMBY (Yes In My Backyard), said the targets were “music to our ears”. “If we meet them, Sydney will be a better, fairer and cheaper place to live,” she said.
However, the group warned councils would have to be held to account and punished if they dragged their feet. “The previous round of targets were barely enforced and as a result, most councils are on track to miss them,” Neighbour said. “For the sake of Sydney’s renters, that can’t happen again.”
That point was echoed by Tom Forrest, head of developer lobby Urban Taskforce. “We welcome the idea that there will be a carrot approach, but there also needs to be a stick,” he said. “What are the consequences for refusing point-blank to get on the housing growth bandwagon? Maybe that will come after the council elections.”
Estelle Grech, planning policy manager at the Committee for Sydney think tank, said the targets were a critical step, but the government needed to dedicate budget funding for social and affordable housing “to make up a substantial portion of these targets”.
Sydney mayors varied in their responses. Woollahra’s Liberal mayor Richard Shields said the new targets would be “catastrophic for our area”, leading to overdevelopment, loss of tree canopy and strained public transport and schools.
Ku-ring-gai Mayor Sam Ngai said the significant increase in his municipality did not come as a surprise, but questioned if there would be enough construction workers to build those homes.
Minns also announced Planning Minister Paul Scully would chair a new subcommittee of cabinet responsible for overcoming delays in development applications. The premier said the Department of Planning “often gets a bad rap” but “there’s a whole bunch of other government agencies [and] corporations” that could delay approvals, citing Sydney Water as an example.
The new targets come after the government scrapped the Greater Cities Commission, responsible for setting the last round of housing targets. Last year, the Herald revealed Labor had rejected the former commission’s initial recommendations for new targets because it saw them as insufficiently ambitious in some parts of the city.
Labor has made increasing housing supply, and density, in Sydney’s inner suburbs a signature commitment since coming to power on the back of a housing affordability crisis. On Wednesday, the premier said the crisis was touching all parts of society, increasing social inequality, discouraging people from starting families and forcing people to leave Sydney.
“[It] undermines social mobility, makes people work longer and harder for less reward, creates division between generations and in some instances drives a physical wedge between families – and that undermines an entire generation’s entry into personal and professional horizons as they reach adulthood”.
Minns said the new targets were “ambitious” and would be tough to meet, but the more houses the state built, the better. “The biggest trap we can fall into is pessimism,” he said.
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