Warning that Sydney’s broken housing market could take 20 years to fix

NSW needs to look abroad for housing solutions, experts warn, amid warning it could take two decades to fix our broken market.

Sydney residents could face another 20 years of housing pain, expert voices have warned, amid calls to look abroad for the answers to our homes shortfall crisis.

“Sydney doesn’t have to be as unaffordable as it is now,” Committee for Sydney CEO Eamon Waterford said.

His organisation recently released research that found there was a $10 billion a year drag on the city’s economy because of high housing costs.

Mr Waterford said workers were wasting more time and money on lengthening commutes and employers were having to pay ever-higher salaries to attract talent.

He said overhauling the “very poor” planning system was vital to a broader improvement in affordability.

Josh Monro is a nuclear medicine registrar living in a new subsidised development at Westmead. Picture: David Swift

He added: “I’m more hopeful now than I have been in a while. We’ve got a state government and indeed a national government and a national cabinet who have clearly articulated that housing is a priority for them and they’re going to work on it and fund it.”

But Mr Waterford cautioned that there are no quick fixes.

“It took us 20 years to get into this place and it’s going to take us 20 years to get out of it,” he said. “So will it get worse? Probably.”

Mr Waterford said Tel Aviv – which is more expensive than Sydney, New York and London – offered a guide to what needs to be done.

He said Israel’s major metropolis had invested in housing specifically for key workers such as nurses and teachers, knowing that without them “a city stops functioning”.

Overhauling the “very poor” planning system is vital to a broader improvement in affordability. Picture: NCA NewsWire / Max Mason-Hubers

This has begun to happen on a lesser scale in Sydney.

St George Community Housing (SGCH) currently discounts the rent on 85 apartments at Westmead’s Highline building. One tenant is nuclear medicine physics registrar Josh Monro, who works at the nearby hospital.

The SGCH scheme saves him about $200 a week and means he hasn’t had to buy a car, because he can walk to work and use public transport to get around.

“It’s been very nice to be able to tuck away that extra income for a rainy day or for the future,” Mr Monro said.

SGCH chief Scott Langford told The Daily Telegraph it was able to offer apartments at a discount mainly because it gets cheap long-term funding from the National Housing Finance and Investment Corporation.

Where a bank might only offer three-to-five year lending at as much as 2.5 per cent above the cash rate, NHFIC provides up to 15-year loans on a less than one per cent margin.

Josh Monro walks to work at Westmead Hospital. Picture: David Swift

SGCH, which is the state’s biggest community housing provider, hopes to add up 1000 more subsidised homes through the federal government’s recently legislated $10 billion Housing Affordability Future Fund.

“The passage of the HAFF was a significant milestone,” Mr Langford said, adding that he believed it would attract investment into the sector.

Mr Langford said SGCH had become “much more optimistic about the possibilities.”

However, The Australia Institute’s senior economist Matt Grudnoff told The Telegraph the federal government’s whole approach to housing was “overly complex.”

“This will have the effect of making it very difficult to evaluate,” he said.

“It would be far simpler if the government allocated money from the budget to building more public housing. Creating a fund, the interest of which will be used to fund private and not for profit organisations to build social and affordable housing is complex and more likely to face problems.”

The Telegraph repeatedly requested interviews with federal housing minister Julie Collins and Treasurer Jim Chalmers about the HAFF over several weeks, including via the Prime Minister’s office.

Premier Chris Minns said his government had doubled the percentage of affordable housing in some major complexes. He reiterated an intention to offer developers up to 30 per cent more floor space in return for a 15 per cent social-housing mix.

“In the long run we want to attract private capital and use … the airspace on their developments to produce more into the marketplace,” Mr Minns told The Telegraph.