Friday, 6 February 2026

In this Edition...

1. Housing approvals – NSW hits the lead (finally)

2. HAFF Round 3 Partnerships program bombarded with EOIs

3. “Relevant defect” changes for Decennial Liability Insurance raise more questions than answers

... and much, much more ...

4. Interest rate hikes a disaster for housing supply
5. Packed house hears about Sydney Plan
6. Queensland Government understands feasibility and the impacts of “nice to haves” on housing supply.
7. Quote of the week
8. South Australia lands critical housing deal with the Commonwealth
9. Planning controls finalised for 4 more TODs 
10. Mills Oakley – What to do when a council returns and ‘rejects’ the lodgement of your DA or Modification Application in NSW?
11. Defence to sell key sites in Sydney?
12. Council Watch
13. Members in the news

1. Housing approvals – NSW hits the lead (finally)

Positive news from the latest monthly data released by the ABS on housing approvals. The month of December showed that NSW had finally hit the lead in terms of monthly approvals

Looking at the annualised data, the NSW worm is taking a decidedly upwards turn - now almost catching a faltering Victoria.

As we keep saying, where goes NSW, goes the rest of the nation – and the strong performance of the state helped to build strong national wide approval numbers:

But there is still daylight separating current performance with what is required.

Of concern too was the stagnation in Victoria. It has been the relative standout in recent years, but the imposition of a massive hike in property taxes has harmed the market for new home construction.  This should be a warning to all of the other states.

NSW Premier Chris Minns and his Planning Minister Paul Scully should take some level of pride in this week’s figures. The cumulative impact of their reformist agenda when it comes to housing and planning is starting to bear fruit.

The next challenge (besides further lifting approval numbers) will be converting these approvals into housing starts. And this is where reducing the impact of fees, taxes and other charges on new housing (especially when monetary policy is tightening) needs to be reviewed.

2. HAFF Round 3 Partnerships program bombarded with EOIs

*An explanatory note for Millennials and younger – this is a post box!

It’s hardly surprising that a well-crafted Federal Government housing policy will illicit a strong response from the market. 

We have always said that if you design the right policy, the market will respond in kind.

HAFF Round 3 opened for Expressions of Interest (EOIs) on January 30, 2026 (last Friday), with the detailed documents available at 3pm that day.  It is a non-competitive, open-ended process with no fixed closing date—it would remain open until all 21,350 dwellings are contractually committed.

That threshold was reached on Tuesday afternoon, By Wednesday, there were over 16,000 additional on the reserve bench, just in case some of the initial EoI did not proceed to contractual close.

What a contrast to the meanderings and delays of Round 1 under the former Minister and Chair.

The creation of a waiting list means that if accepted EOIs do not progress to contract close, a steady supply of alternative EOIs is there waiting and can fill the void.

The Federal Minister for Housing, Clare O’Neil, is putting her stamp on housing policy and housing supply, and the signs are good.

3. “Relevant defect” changes for Decennial Liability Insurance Bill raise more questions than answers

Four years later, no DLI product has been approved by the Government, with the proposed increase in the strata building bond deferred repeatedly.

The problem is that with no insurance available, many builders left the NSW Class 2 construction market.  This deepened the housing supply crisis. This has resulted in fewer builders just at the time where the Planning Department has cleared the decks to allow for more building approvals. 

Urban Taskforce Australia has urged the NSW Government to refine the current definition of “serious defect” in building legislation, warning it is overly broad and undermines the viability of DLI.

Now the Minister, under advice from the NSW Building Commission, has adopted some subtle changes to the definition of “serious defect” – under the Building Bill the concept of “relevant defect” will replace the old references to “serious defect”.

The stated difference is the alleged exclusion of the more subjective elements of the RAB Act definitions which resulted in insurance companies refusing to put a DLI product to the market.

So, if it were the case that these changes will result in a plethora of DLI insurance products with adequate coverage, and a competitive insurance market for DLI emerges, then these changes would be good news.

If not, industry will be left with inadequate coverage. The Building Commission and the Building Minister would be holding back the stated number one priority of the Minns Government – housing supply.

What industry needs is a back-to-back product which covers all of the obligations currently under the definition of serious defect under the RAB Act.

With respect to the definitions, we are advised that the proposed changes contained in the Bill will not provide full coverage for builder/developers, but will only assist insurers provide a product to market which satisfies the Government. Critically, it will not provide full coverage.

This exposes the builder/developer to an uninsured gap.

This is the crux of concerns.

If the Bill is faciliating an inadequate product which continues to leave industry members exposed, it should be withdrawn and further consultation undertaken.

With all the effort the Minns Government has exerted in turning around housing supply, tinkering around the edges and adopting a smoke and mirrors  approach to such a serious issue as defect liability insurance would be an unfortunate misstep.

Urban Taskforce is reviewing the Bill. 

The Bill makes several other changes, such as amending the Design and Building Practitioners Act 2020 to remove the existing 12‑month limitation to exempt persons or types of work from insurance requirements under the Act.

Building practitioners are currently exempt from holding professional indemnity insurance as there are no available insurance products to satisfy their legislative requirements. The Government is rightfully concerned that without this exemption, building practitioners would need to cease work on regulated buildings, namely classes 2, 3 and 9c, causing significant delays to the delivery of housing across New South Wales.

The existing scope of the regulation‑making power requires the exemption to be remade every 12 months. The amendment removes this requirement and ensures that practitioners continue to be exempt from professional indemnity requirements until such time the market develops a complying product, which will hopefully provide greater certainty to industry.

4. Interest rate hikes a disaster for housing supply

The chickens are coming home to roost for Governments and Treasuries around the nation that thought it was a good idea to pump prime the housing market with a flurry of Government-backed handouts to first home buyers.

Handouts are eternally popular in retail politics, but if housing demand stimulus is not matched by housing supply, it’s long-term pain for the Australian economy, particularly for those looking to buy or rent a home.

The only way a central back can respond is through tightening monetary policy – which we saw this week with the RBA lifting the cash rate to 3.85%, with further hikes likely this year.

This is a double whammy for the property sector, which was just starting to see green shoots. However - debt free, boomer NIMBYs were heard rejoicing across the land.

The Federal Government needs to use its upcoming budget to focus on productivity boosting policies ... remember the Productivity Summit ... 6 months ago?? (Actually, no-one can!).

The Albanese Government also has to be strategic on where it invests taxpayers' money. Housing enabling infrastructure is critical to housing supply, housing choice, and supporting a more productive workforce. IT should be a focus for the May budget. 

5. Packed house hears about Sydney Plan

Urban Taskforce members turned out in large number yesterday for a presentation from the Department of Planning, Housing, and Infrastructure on the proposed regional strategy for Greater Sydney. 

Hosted by Allens, the forum was a timely opportunity to hear about the Department’s approach to strategic planning, how that relates to the draft Sydney Plan, and what the NSW Government will do to deliver desperately needed industrial lands. 

Three speakers from DPHI – the enigmatic Tom Loomes, Jessica Farrell, and Melissa Rassack – turned on a show.

They gave an overview of the philosophy behind the plans and how the new strategy will take over from (and correct problems with) the 2018 “Metropolis of Three Cities”.

They spoke of how the Department’s goal is to make strategic planning more responsive, outcomes based, and flexible. A worthy cause indeed.

The new approach is based around conducting planning at state, regional, and local level, with direction set by the State Government and implemented at a council level. 

The Regional Plans – of which the draft Sydney Plan is one – are subordinate to the State Plan, which is still under development, and a range of policies outlining how planning activities will be conducted. 

The first of those policies is the Statewide Industrial Lands Policy, which is also out for consultation. 

Members who were in attendance engaged with the speakers, with particular emphasis on: 

• The importance of choosing language carefully (and allowing a relief valve to accommodate new projects).
• The need for members to review the spatial viewer tool on industrial land to ensure that members are comfortable with the designation.  If not, get submission into DPHI ASAP and cc. Urban Taskforce so we can include your concerns in our submission.
• Delivering a centres policy to allow an increase in mixed use development and an explicit recognition that residential development is an ingredient of a Centres.  This has already been recognised by the HDA. It is important that the HDA’s pro-housing policy is reflected in this Region Plan.
• Not treating business parks as sacrosanct but allowing a range of different uses on existing sites.
• Ensuring that feasibility and housing supply are considered in any planning decisions.
• Being careful about mandatory affordable housing plans, so that they don’t push new housing into unaffordable territory. 

Our thanks go to Allens for graciously hosting this event in their soon-to-be-vacated premises, and to Tom, Jessica, and Melissa for informing attendees about their draft plans. 

6. Queensland Government understands feasibility and the impacts of “nice to haves” on housing supply.

Deputy Premier, Minister for State Development, Infrastructure and Planning and Minister for Industrial Relations, Jarrod Bleijie, this week escalated the Queensland Government’s release of government land for housing, releasing a 6-hectare site in the northern suburbs of Brisbane.

The Land Activation Program is part of the Crisafulli Government’s Securing Our Housing Foundations Plan targeting a million new homes by 2044.

Critically, the Queensland Deputy Premier is the first politician with the courage to call out the virtue signalling idea of inclusionary zoning – affordable housing taxes – for the impact it is having on housing supply.

It is a reason why NIMBY’s love affordable housing taxes – it cruels development feasibility and leads to less housing all round.

We were shocked at the trite response from the Queensland Opposition, which somehow saw only affordable housing as a public good. According to the Labor Opposition, market housing seems to be considered an inferior pursuit of Government.

One of the reasons we find ourselves in the middle of a housing supply crisis is the piling up of political "nice to haves" on the housing supply marketplace – state and local infrastructure contributions, affordable housing levies, biodiversity, heritage etc etc. It impacts the price of housing and the cost to deliver it.

The Queensland Deputy Premier has obviously read and digested some of the conclusions of last year's policy wonk best seller “Abundance” – unlike his Labor opponents (apart from Federal Member for Fenner, Dr Andrew Leigh!)

7. Quote of the week

We couldn’t go past the sentiment expressed by the Queensland Deputy Premier.

8. South Australia lands critical housing deal with the Commonwealth

Source: Facebook

The Albanese and Malinauskas South Australian Governments have struck a deal to unlock 17,000 new homes for South Australians, including nearly 7,000 for first home buyers.

The $801.5 million deal announced today is a major milestone in the delivery of the Albanese Government’s 2025 election commitment to help build 100,000 homes for first home buyers, in partnership with state governments and industry.

In addition to 6,877 new homes for first home buyers under the South Australian and Commonwealth Government deal, it will also unlock approximately 10,000 additional homes for other home buyers, adding significant housing supply.

The Albanese Government will provide $667.9 million in support to pave the way for these houses to be built and tackle major housing supply barriers including:

• A $300 million concessional loan to deliver even more water infrastructure in the Northern Suburbs, that will directly unlock and deliver 4,000 homes.
• A $50 million 3-year concessional loan for civil works to deliver a new first homebuyer-only precinct of 400 homes within the Playford Alive urban renewal development.
• An $184 million concessional loan to deliver over 1,700 homes at multiple urban renewal projects across metropolitan Adelaide.
• $133.6 million in grant funding, which South Australia will match, to deliver 750 dwellings for first home buyers through other programs.

Construction will be fast-tracked so that the first of these homes will commence construction in 2026/27.

The NSW Premier, Chris Minns, needs to take note: when it comes to the lead up to the NSW election, hit Albo for everything you can get!

This is exactly the king of Federal support needed to drive through the planning reforms and get serious about housing supply. It should not rely on the electoral cycle – but it appears that it does.

9. Planning controls finalised for 4 more TODs

Belmore TOD, ripe for development?

NSW Minister for Planning, Paul Scully, this week announced that four more sets of planning controls had been finalised for the Transport Oriented Development precincts of Croydon, St Marys, Belmore and Lakemba.

Working closely with the relevant local councils, the Government has come up with plans that facilitate taller, mixed-use buildings. The Minister claims the finalised plans will “unlock” more than 31,000 new homes.

The formalisation of TOD controls means developers can now lodge applications and bypass lengthy rezoning processes.

Will the controls be sufficient to “unlock” the intended new housing? So far, the only TODs that have stacked up from a feasibility perspective have been those along the north shore – representing around 95% of the 5,000 or so dwellings being advanced to date.

Interest rate hikes and ongoing fees, taxes and charges cast a long shadow across the feasibility of development, particularly in Sydney’s west.

Finalising these controls is good – but will they work?

10. Mills Oakley – What to do when a council returns and ‘rejects’ the lodgement of your DA or Modification Application in NSW

A cynical tactic of some Councils is to reject or delay development or modification applications by returning them for alleged incompleteness or by not issuing assessment fee invoices, which stops the application being formally lodged and delays appeal rights.

Under the Environmental Planning and Assessment Regulation 2021, councils can only reject within 14 days on limited grounds. Rejections beyond this, or procedural errors like failing to issue an invoice, may be legally challenged through internal review or in the Land and Environment Court via judicial review and related proceedings to compel proper lodgement.

Partner Anthony Whealy, Special Counsel James Oldknow and lawyer Anthony Russell-Thomas, from Urban Taskforce member Mills Oakley have prepared a paper setting out legal options for NSW applicants who fall foul of this delaying tactic.

11. Defence to sell key sites in Sydney?

Looks like Defence might be finally stepping out of the 19^th century and is looking at offloading a number of key sites across the nation.

In NSW - lucrative sites like Victoria and Randwick Barracks could open up housing opportunities. The potential sale of HMAS Penguin will be sending the Mosman NIMBYs into a meltdown.

We also noted the NSW Government has not ruled out purchasing some of these sites. The NSW taxpayer shelling out dollars to the Commonwealth taxpayer (the former being a subset of the latter) - strange days indeed!

12. Council Watch

Federal Minister names and shames North Sydney and Woollahra Councils

It was pleasing to read part of a speech delivered by Federal Housing Minister Clare O’Neil. She and her office obviously have been digesting our monthly reports on the “leaners” when it comes to housing supply:

Mosman

Progress is glacial, but Mosman Council has announced stage 1 of its plan to exempt themselves of any responsibility to take on a fairer share of housing.

Stage 1 involves a baseline review and “place understanding”. Apparently, part of this understanding is feasibility considerations - but we won’t hold our breath for Council deciding to work with industry in facilitating new housing.

Mosman's master planning will take shape over an approximately eight-month period, with an expedited timeline for a process that typically takes about two years. You can read more about the project framework below.

13. Members in the news

“… Supermarket giant Woolworths is looking to capitalise on the resurgence of interest in shopping centres with a deal to sell off a $300m portfolio to an Asian investment group close to being struck … read more ...                                

The Australian, 1 February

“… But according to Robert Sargis, co-director of site developer DPG Project 19 Pty Ltd, which acquired the site in 2022, urban change on Parramatta Road was “desperately overdue … read more ...                                

SMH, 2 February

“… The largest development across the entire length of Parramatta Road will involve the construction of 1185 units in six residential towers, standing up to 30 storeys tall, as part of a sprawling $805m development by Deicorp on Parramatta Road in Five Dock … read more ...                                

SMH, 2 February

“… MA Financial has agreed to sell Corrimal Village, a shopping mall located six kilometres from Wollongong’s city centre, for $103 million to an undisclosed private buyer … read more ...                                

AFR, 5 February

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