The Sydney housing affordability crisis is longstanding. NSW’s regional areas have traditionally presented a more affordable option for those shut out of the Sydney market. But - in the context of a much reported “COVID-19 related exodus” from Australian cities - for how much longer?

According to Australian Bureau of Statistics data internal migration resulted in a net loss of 11,200 people from Australia’s capital cities in the September quarter of 2020. This compares to a net loss of 5,630 for the same quarter in 2019.

In Greater Sydney there was a net loss of 7,800 in the September 2020 quarter, compared with 6,200 people in the same quarter of 2019.

People may be leaving Sydney, but this is not resulting a reduction to Sydney housing prices.

Economists are predicting another surge in Sydney house prices of about 8% over 2021, with the RBA projecting an increase by 30% over the next three years if low interest rates continue.

The prospects for much needed housing supply to drive housing prices down in Sydney, at least in the short to medium term, are highly unlikely. The impact of a 2019 slowdown in the release of rezoned land for housing (which got worse in 2020 due to COVID-19) is yet to flow through to household completion numbers – but it will – and this, together with low interest rates, will greatly exacerbate the current rising prices in the Greater Sydney market.

While the recent loss of people from Australia’s capital cities is the largest on record, it’s not a significant proportion of the national population. But it does represent a significant increase in demand in our regional towns and centres. The additional demands of a growing population in terms of infrastructure capacity, jobs and services and critically – housing affordability – are now all urgently needing attention.

The housing researchers and economists are already talking about this emerging issue for NSW:

“The change between metro and regional housing demand in NSW has been more substantial than in other states,” writes Tim Lawless Research Director at Core Logic

“.. I expect (housing prices) in regional areas within—a two-hour zone of Sydney—could be up towards 10 per cent next year,” predicts Shane Oliver, Chief Economist for Shane Oliver.

Urban Taskforce members are talking about it too.

EG’s Dr Shane Geha was recently featured in Business Insider Australia expressing the view that Australians moving to the regions would be a temporary trend. Dr Geha, on LinkedIn,  also agreed with Combined Development Group’s Graham Walker that while the amount of people currently leaving Sydney “will go almost unnoticed in the City… the impact of an extra 50,000 people descending upon a handful of desirable regional towns is massive.”
 

“Massive” impacts are already being felt. Recent increases to house prices in some parts of regional NSW are even greater than those in Sydney. Places like Byron Bay, Wollongong and Newcastle are experiencing average house price gains of 14%, 12% and 9% respectively.

The Urban Taskforce calls on NSW planners and policy-makers to act on this potential crises for the regions. It’s time for the NSW Planning System to wake from it’s COVID-19 malaise. The paid holiday is over, and we need housing supply as well as infrastructure support across NSW.

Last year was a big year for promises and commitments relating to post COVID-19 deregulation and economic growth.  The first set of changes relating to Infrastructure Contribution has been quietly made this week.  There is nothing dramatic here – but it is a step in the right direction.

You may recall the public exhibition by DPIE of proposed changes to the NSW Infrastructure Contributions during April – June 2020.  This process was usurped by Peter Achterstraat and the NSW Productivity Commission to a large extent. Nonetheless, three of the five exhibited proposals have now been released, being:

1. The Planning Agreements Practice Note has been updated to provide guidance to planning authorities when preparing planning agreements. It reinforces that planning agreements are to be used primarily to fund innovative infrastructure solutions and not for the primary purpose of value capture – an issue with the current regime that was raised by the Urban Taskforce.
2. The Section 7.12 Fixed Development Consent Levies – Practice Note sets out what is to be included in a section 7.12 Contributions Plan as well as criteria for metropolitan and regional councils requesting an increase to the standard maximum section 7.12 levy from 1% to 2%, or more than 2% including a requirement for councils to review their section 7.12 contribution plans every 5 years.
3. The Environmental Planning and Assessment Regulation 2000 has been amended to include new accounting, reporting and online publication requirements for councils and planning authorities. Minor updates have also been made.  

The remaining two proposed changes - to section 7.11 contributions plans and Special Infrastructure Contributions - have not yet been released. Urban Taskforce has been advised that they will be considered as part of the Government's response to a review of the NSW infrastructure contributions system undertaken last year by the Productivity Commission referred to above (final report released in December 2020). 

Urban Taskforce will be keeping a very close eye on DPIE and the Government to ensure that the real reforms proposed by the Productivity Commissioner are progressed and realised ASAP.

Links to the relevant documents and amended Regulation can all be found here.

Urban Taskforce welcomes this work as a good start on the much needed reforms to the NSW Infrastructure Contributions system in NSW. Now that the ‘low hanging fruit’ has been dealt with, it’s time for the Government to get on with the more challenging aspects of this reform area.

Last night marked the much anticipated return to Urban Taskforce Twilight Tours, hosted by Urban Tskforce CEO, Tom Forrest with a guided tour of Waterfall by Crown Group. 

Crown Group CEO Iwan Sunito, Chief Operating Officer Pierre Abrahamse and the team led Urban Taskforce members on a site tour of their new cleverly designed, resort style, mixed-use development at Waterloo.

The development, completed in 2020, comprises four buildings containing over 300 apartments, 12 retail spaces, an infinity edged pool and spa, a cantilevered gym, function room, rooftop cinema, music room, extensive landscaping including lagoons and outdoor seating areas, a man-made waterfall spanning 7 stories in height and 732 sqm public park.

For more information on Waterfall by Crown Group click here.

If you have a newly finished project and would like to host a Twilight Tour to showcase your achievement - please contact Urban Taskforce Manager, Events and Membership: Nicola Baume.

 

Red Faces??

While Minister Stokes had a superb week in Parliament drawing lavishly on his surfing experience and knowledge of the local lingo to lash his Parliamentary opponents, it appears that his office might have hit the beers a tad early in celebration!

Urban Taskforce was excited to read the announcement by Ministers Stokes and Pavey that the State Significant Development (SSD) Pathway would now apply to "major projects with a value of more than $100 million".

It seemed strange to us that such a significant (and welcome) shift in policy would be buried in a statement regarding the NSW Housing SEPP – and so it turned out to be.

A flurry of phone calls with public servants and Ministers’ offices revealed that the wording of the media release was … umm … not as precise as it might have been.

The announcement is supposed be relate to the changes that were published in December last year, relating to projects developed by the Land and Housing Development Corporation with a value greater than $100 million.

The original media release is here.  You make up your mind regarding its meaning.  Fact is – while Urban Taskforce strongly believes that all projects with a value greater than $100 million should be treated as State Significant Development, it appears that at this time, this policy goal remains a light remains on the distant hill of economic progress.

Sigh ...

DPIE staff rumoured to be considering a nomination of  Urban Taskforce for Greater Sydney Planning Awards?

Word on the street is that DPIE is considering nominating the Urban Taskforce for the bold, policy shifting publication of the special edition of Urban Ideas: Tax and Development which set the agenda for infrastructure contributions and stamp duty/land tax reforms.

The rumour is that the award nomination will be made under the 'Planning Disruptor" category.

Entries to the Greater Sydney Commission's (GSC) Greater Sydney Planning Awards close Wednesday 5 May 2021

For more information on the GSC awards visit here.

Which council(s) …?
 

There is growing concern amongst the architectural community that the concept of heritage is being selectively used by some councils to stifle development on the one hand, while they are quick to call in the bulldozers when it comes to development on their own land.

It’s bad enough that some council leaders are hypocrites. It’s worse when it comes at the expense of genuine heritage.

Meriton’s unique mixed-use neighbourhood “Destination’’ at Macquarie Park featured … read more...
Urban February 2
 

CBRE’s research on and Lateral Estate’s and Mirvac’s Build to Rent developments … read more...
Urban February 15
 

Wingate’s Bloom at Arncliffe, Ellerson’s The Laneways at Rosebery and Meriton’s Eminence at Zetland all profiled as apartments you can secure without paying stamp duty … read more...
Urban February 17