‘Vicious circle of housing misery’: Sydney all built up, with no place to go

A former premier once said NSW could “have it all”, but the Productivity Commissioner warns the state can’t have it all at once, James O’Doherty writes.

Before the 2019 election, then-premier Gladys Berejiklian declared NSW can “have it all” – not just new stadiums but schools and hospitals to boot.

But, if Productivity Commissioner Peter Achterstraat is to be believed, we just cannot have it all at once.

Achterstraat’s withering assessment of housing supply this week laid bare the problems looming on the horizon for Premier Chris Minns, who has staked his government’s success on building NSW out of the housing crisis.

While the construction workforce is busy building transformational infrastructure projects like the Metro, there are simply not enough workers around to build new housing, the Productivity Commission argues.

This is the catch-22 that threatens to hang like a millstone around the Premier’s neck.

There are problems on the horizon for NSW Premier Chris Minns. Picture: NewsWire / Simon Bullard.

We need hundreds of thousands of new homes to accommodate our booming population, but those homes need to be supported by new infrastructure. All of that construction requires more skilled workers, many of which come via migration – adding further strain to the housing crisis.

Thus, we are in a vicious circle of housing misery from which there is no easy escape.

The Premier has been rightly commended for tackling this problem head on. The high-density housing reforms around transport hubs (“Transport Oriented Developments,” or TODs) is a good idea, despite the protestations of many NIMBY council candidates running in Saturday’s local government elections.

Minns has also championed an unsolicited plan to turn Rosehill Racecourse into a mini-city with tens of thousands of homes, supported by a Metro station: A once-in-a-lifetime opportunity.

But these reforms will only dent, not break, the crippling lack of supply.

The Productivity Commission found that the TODs will create capacity for 61,855 homes over 15 years (other reforms allowing higher density around 37 stations will add more).

These reforms to increase housing density in established areas is, as Sir Humphrey would say: “Courageous”.

Landowners do not take kindly to the idea of their suburb’s leafy vibe being eroded from underneath them.

To counter that narrative, Minns and his core ministers also rely on the Productivity Commissioner. They quote, ad nauseam, his previous findings: Without more homes, Sydney will become a city with no grandchildren.

Without new housing supply, older millennials will continue fleeing Sydney for places they can afford – taking their children (or the prospect of children) far out of reach of a Sunday drive.

Without access to housing, younger generations could continue to flee Sydney. Picture: NCA NewsWire / Max Mason-Hubers

As their argument goes, what would homeowners with adult kids prefer: Living in a suburb of quarter-acre blocks, or being able to see their grandchildren more often than at Christmas and Easter?

Now Minns has been urged to go harder, by his own bureaucrats, to “significantly” lift the height of developments in TOD zones and expand the zoning reforms to within 800m of chosen railway stations, up from 400m.

Minns says he would be “happy to do it,” but for the lack of enabling infrastructure available – there’s that catch-22 again.

Further, he argues that families in Western Sydney waiting for new homes need the infrastructure that will come with it:

“When you speak to families in Western Sydney, they’ll say: ‘Look, it’s great the house has been built, but we were promised a new school and a hospital and access to public transport,’ so we can’t stop (building homes),” Minns says.

As it stands, we are nowhere near meeting ambitious housing targets the Minns government agreed to in national cabinet.

He even admitted this to me at the start of this year. Something needs to change.

While the Premier is to be commended for tackling the housing crisis, there comes a point where the rubber must hit the road.

Sydney all built up with noplace to go. Picture: ChatGPT

If Minns is hanging his premiership on fixing the housing crisis, he does not have long before his report card is due.

From a purely political standpoint, this is where wiser heads in the NSW Liberal Party think they can create political opportunity.

While Opposition leader Mark Speakman is at sixes and sevens over whether he supports more housing or not, there are those in his party that believe the Coalition should back Minns’ plan – but hold him to account when (not if) he fails.

If Minns is to have any hope of succeeding in having any impact, he needs to make it easier for developers to build homes, while ramping up pressure on the Commonwealth to direct skilled migration to where it is really needed – builders.

He does not have long before the chickens come home to roost.