31 JANUARY 2025

In this Edition...

1. When two tribes meet… hopefully to take the politics out of planning reform

2. Almost 100 EOIs in 3 weeks – HDA market-driven approach shows the pent-up demand waiting for the right settings 

3. Tide turning for constant churn in National Construction Code?

...and much, much more.

4. Federal Opposition is backing the wrong horse when it comes to immigration and foreign investment in housing
5. Central Barangaroo – “frankly embarrassing”
6.  Ingham Property Group and Aldi execute lease for Distribution Centre at Bradfield 
6.  Ingham Property Group and Aldi execute lease for Distribution Centre at Bradfield 
7. Off site impacts sorted for State Significant Developments, but all other housing proposals must plod through Kafka-esque landscape
8. Lack of housing supply leaves rents too high
9. More Exempt and Complying reform
10.Industrial Lands Action Plans – webinar
11.Urban Taskforce in the news 
12.Members in the news

1. When two tribes meet… hopefully to take the politics out of planning reform

This week saw an outbreak of bipartisanship in NSW around the historically vexed issue of planning reform, with the Premier and Leader of the Opposition meeting to discuss next steps on the much hyped revamp of the Environmental Planning and Assessment Act (1979).

The summer holiday campaign by Urban Taskforce and the Telegraph (later joined by the Sydney Morning Herald) continues to show some positive signs. Tom Forrest, CEO of Urban Taskforce spoke to various media outlets in an effort to convert talk and general bon homie into a course of action along with a timetable.

The NSW Opposition’s Mark Speakman and Scott Farlow took the lead and held an extensive meeting with Urban Taskforce of our view on reform. 

The meeting between the Premier and the Leader of the Opposition, which also involved the Minister for Planning and his Opposition counterpart, resolved to hand the matter over to Minister Scully and Scott Farlow to establish both a process and a set of principles which will drive the reform.

There is no doubt about the need for change. The obligations under the EP&A Act 1979 enable those who oppose housing supply (for whatever reason) to drag the assessment and exhibition process out to inordinate lengths. This is the single biggest killer of housing right now:

Tom also had an opportunity to talk to ABC Radio not once, but twice on the meeting between the Premier and Opposition Leader.

Tom then called on the spirit of the Sydney Olympics to solve the housing supply crisis:

Urban Taskforce also offered up 6 “quick wins” where a bipartisan approach could sign, sealed and deliver this year:

1.  Re-draft the Objects of the Act to make housing supply (and employment) the primary objective of the Act.

2. Re-establish flexibility (merit-based assessment) into the planning system which explicitly considers the housing supply shortage as the key priority objective of the Act.

3. Remove the need to comply or be consistent with the outdated Greater Sydney Region Plan (published pre-Covid and pre housing supply crisis in 2017) and assess rezoning applications against a short set of key criteria, the top of which must be housing supply and targets set for each LGA.

4.  Review the Apartment Design Guidelines to ensure that it is understood that they are guidelines only and are not necessarily applicable in many cases.

5) Allow for non-compliance with the controls prescribed in Local Environment and Development Control Plans, including on permissible height, the land use permitted by the zoning, density controls, and the separation between buildings, all based on a merit-based assessment. This could be brought in for a set period to assist in achieving the Housing Accord targets. This used to be allowed through SEPP 1 but was abolished when the Template LEP was adopted over a decade ago. The replacement was too complex and convoluted.

6) Review the time consuming, repetitive and expensive Design Review process to allow for exemption for applicants that use a top tier architect. This was foreshadowed by the Premier in the 2023 Bradfield Oration, but has not yet happened.

Urban Taskforce also detailed a range of medium term changes that should be made to the Act and to the planning system to stimulate interest in housing supply and investment in employment.

2. Almost 100 EOIs in 3 weeks – HDA market-driven approach shows the pent-up demand waiting for the right settings 

The HDA is nothing short of a revolution in terms of NSW planning – or that’s the way it’s looking right now.

Urban Taskforce has consistently argued that solving the housing supply required Government to reach out to the private sector and test the market to see what the private sector could come up with once you cast aside the preordained planning dogma.

Solving the crisis was not about coming up with a set of top-down prescriptions and a series of “though shalts” which has cruelled the otherwise positive TOD initiative, but about calling for expression of interest from the private sector and letting them tell the government what is possible.

It appears to have worked already!

The Government’s announcement that almost 100 applications – for the delivery of an astonishing 40,000 new homes – had already been received through the EOI process in the first 3 weeks since the HDA was formally established – is tremendous news.

While the Government seemed surprised by the level of market response – Urban Taskforce was not.

Urban Taskforce has spoken to anyone who will listen about the level of pent-up market and investment interest in housing supply, only to be repeatedly frustrated by reforms that came with caveats and new taxation (or euphemistically titled “contributions” to be applied which cruelled the feasibility of development and the intent of the policy reforms.

3. Tide turning for constant churn in National Construction Code?

Amidst a housing supply crisis, a number of jurisdictions are pushing back on any further changes that add to the cost of building new homes.

Back in August 2024, the Malinauskus Labor Government in South Australia broke from the pack and said it was freezing any future changes to the NCC for a decade. Then the Tasmanian Liberal Government came out just before Christmas announcing it too would defer any future changes and called for a slowing down of the three-year cycle of constantly amending the Code.

Now with an unabashedly pro-housing Government in Queensland, there is some hope that Queensland will also back away from the NCC regime – with new Housing Minister, Sam O'Connor MP, reviewing the impact of changes to the NCC.

On top of this, Federal Opposition Leader Peter Dutton has committed to place a 10-year freeze on the code, in the interest of creating more certainty, less costs, and helping the construction industry get on with the job of building the houses Australia needs.

Meanwhile, the NSW Government appears to be seeking to reinsert changes rejected just 2 years ago when it comes to liveable homes.

The market should be free to decide on whether these higher standards are put in place. Many of our members have already adopted the Livable Housing Requirements and enthusiastically market their product accordingly.

We are concerned about any forcing of changes that add to the cost of housing supply. If the Government believes that there is a cost-benefit case for these changes, then the Government should ameliorate the costs through funding or by providing incentives.

This is a space to keep an eye on, lest the sands slip beneath our feet again.

4. Federal Opposition is backing the wrong horse when it comes to immigration and foreign investment in housing

The Federal Opposition has come out strongly in recent months on the need to direct more federal funds to housing enabling infrastructure.

But the Federal Opposition’s plans to cut immigration and ban foreign investment in housing is bad policy.

While it may play out electorally well in some quarters, Urban Taskforce opposes populist policies around immigration and foreign investment when it comes to housing and solving the supply crisis.

Sure, it ticks a number of short-term political matters, but it is frankly reckless for the long-term future of the nation. Short termism in policy needs to be called out and rejected.

The answer to the housing supply crisis is not to stifle demand, but to solve the supply side. Immigration is critical to the short, medium to long term future of Australia. We need a big boost to skilled trades across Australia right now.

In the absence of meaningful tax or productivity reform, skilled migration delivers the only hope of a boost to our productivity. And faced with a rapidly ageing population, it is the only way we can generate the economic activity needed to support a nation of nonagenarians.

The former Deputy Secretary of the Commonwealth Department of Immigration, Dr Abdul Rizvi, told The Australian that cutting permanent migration to the levels proposed by Mr Dutton, while processing applications from the family visa stream as required, could reduce the skills stream to as few as 60,200 migrants, from the current level of 132,200.

*Please note, the below link may be paywall protected

In so many areas of our economy, we need much more skilled and unskilled labour, not less. And one thing is guaranteed that supply shortages will always have inflationary impacts.

As to the Federal Opposition’s commitments to stop foreign investors buying residential property, it is a policy that again focusses on the demand side. Federal Treasury figures show that foreign investors funded 5,360 homes in the 12 months to June 2023. Why would anyone seek to cut this in the midst of a housing supply crisis?

As the former RBA Head of Economic Analysis and Research and respected economist, Dr Tony Richards says, all housing supply contributes to downward pressure on housing prices (other things being equal).

5. Central Barangaroo – “frankly embarrassing”

Despite a drastic reduction in height, the modifications for Central Barangaroo (referred to as “Mod 9”) continues to languish in the Department of Planning.

It’s time to get the skates on!

*Please note, the below link may be paywall protected

6. Ingham Property Group and Aldi execute lease for Distribution Centre at Bradfield 

Late last year,  ALDI and Ingham Property Group executed an Agreement For Lease to build an 87,000 sqm Automated Distribution Centre at the Ingham & Co industrial estate in the employment core of the Aerotropolis at 475 Badgerys Creek Road, Bradfield NSW. 

The site adjoins the new Western Sydney International airport and has been owned by the Ingham family since the 1960s. The 182-hectare project presents some of the largest, most contiguous, and flattest employment zoned land in Greater Sydney.

The estate can accommodate footprints of up to 100,000 square metres and 51 metres in height within its innovative complying development code. Other than hazardous goods storage, no further Development Applications are needed which gives this estate a year or more of program advantage over competing sites in New South Wales, Queensland and Victoria. 

The Master Plan has been endorsed by NSW Planning, with full approval hopefully by the end of March 2025.

A great result for investment in Western Sydney. Congratulations Ingham!

7. Off site impacts sorted for State Significant Developments, but all other housing proposals must plod through Kafka-esque* landscape

Urban Taskforce noted with some sense of irony, DPHI patting itself on the back in proclaiming legislation that deals with off site impacts on State Significant Developments stemming from a recent Court of Appeal case.

It is important to praise positive change and this is positive.

But the principle should apply to any housing and employment creating proposal, regardless of it being State Significant or otherwise.

The amendments that have been passed by the Parliament do not address related issues that industry has raised regarding the operation of section 4.15 of the EP&A Act, which still requires the consent authority to consider the “likely” impacts of off-site enabling infrastructure under section 4.15 of the EP&A Act.

So we are left with a situation where off-site impacts on state significant developments do not need to be considered,  whilst non SSDA (which still comprises the vast majority of the new housing needed under the Accord) lumber-on, needing to deal with the impossible task of trying to deal with potential future offsite impacts, many of which are simply unknown because those decisions have not yet been considered by government bureaucracies in the related infrastructure agencies.

Is this a chapter from a long-lost novel from the great Czech novelist of the absurd, Franz Kafka?*

**Franz Kafka (1883–1924) was an Austrian-Czech writer, born in Prague, whose works explore themes of alienation, existential anxiety, and the absurdity of modern life. Kafka worked as a lawyer and wrote in his spare time, often producing complex, surreal stories such as The Trial, The Metamorphosis, and The Castle. Kafka was a prolific writer, but he burned an estimated 90 percent of his total work due to persistent struggles with self-doubt.

Perhaps – but these are the sort of bugbears that need to be sorted out in a bipartisan approach to fixing the planning system and its legislative underpinnings in NSW.

8. Lack of housing supply leaves rents too high

While the ABS quarterly inflation data was generally good news, rent prices still stick out like a sore thumb. Rental prices rose 6.4 per cent over the 12 months to the December quarter, down from 6.7 per cent in the September quarter.

While the slowest annual increase in 4 years and down on previous quarters, rent prices remain stubbornly high.

In the words of the ABS “Rental price growth continues to reflect low vacancy rates and a tight rental market.”  In other words – we still have a supply side problem.

One could argue that if the housing supply crisis had been resolved, and rent inflation was back to what it was in the halcyon years of 2016-2018 – an interest rate cut(s) would be a dead certainty. Something for the Prime Minister and his Treasurer to ponder…

9.  More Exempt and Complying reform

The Department has updated the State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 (Codes SEPP). This is part of our ongoing commitment to improving the planning system. 

This update includes over 100 minor amendments to streamline exempt and complying development pathways including:   
•    identifying changes to what you can do to your home or business without needing approval including installing air-conditioning on multi storey apartment buildings or making repairs and/or alterations to existing homes
•    clear rules around complying development for dual occupancies and multi-dwelling terraces
•    making it easier to understand the rules around running farm experiences, farm gate business and farm stays alongside farming operations.
The Department has also made clearer the process for managing and removing asbestos. 

Each year over 30,000 developments worth almost $12 billion are undertaken as complying development under the Codes SEPP so it is good to see the DPHI continue to chip away at reforms that make life easier for many.  

For more information about the amendments, please visit: 

• Essential Codes SEPP updates

• the updated asbestos guidance

For enquiries on the Codes SEPP, please contact codes@planning.nsw.gov.au.

10. Industrial Lands Action Plans – webinar

Last week we noted the release of the Industrial Lands Action Plan, kicking off a process to review and classify industrial and employment land into 3 categories: State Significant, Regionally Significant and Locally Significant. 

While a “plan for a plan”, it does address the long-standing matter of assessing existing industrial land and identify lands that have moved beyond their original purpose and could accommodate other uses such as housing.

For more information, email industrial-lands@planning.nsw.gov.au or visit the NSW Government, Planning webpage.

The Department has also released the 2024 Employment Lands Development Monitor, which provides the latest data on the availability and status of industrial land in NSW. The monitor provides data for the Greater Sydney, Central Coast, Hunter and Illawarra-Shoalhaven regions and 12 cities in regional NSW. 

11. Urban Taskforce in the news

Urban Taskforce not only sets the agenda when it comes to issues like planning reform and ways of turning housing supply around, but we do so with a forensic assessment of housing related data.

Case in point is our periodical break down of ABS stats around housing approvals, commencements and completions. The Daily Telegraph this week used our analysis of the latest ABS data on housing approvals showing the catch up that is needed in NSW compared with States like Queensland and Victoria:

We continue to hit nails on the head, and we do so because of our research and analysis of statistics. As we are wont to remark, “the data does not lie.”

12. Members in the news

*Please note these articles may be paywall protected

“…Holdmark is the latest to look to the ToD, which the government says "encourages sustainable and mixed-use development around transport and aims to create vibrant and walkable communities...read more... 

To read more, click here:                    urban.com.au, 29 January

"…Dexus has gone back to the drawing board for its Waterfront Brisbane development, dramatically reworking the design for the riverside precinct’s planned retail and dining destination.​​​​..read more...

To read more, click here:                       The Urban Developer, 29 January