80,000 homes approved but almost none being built

A new report from Ray White Commercial Western Sydney has revealed a staggering gap between residential development approvals and construction rollout.

The Western Sydney Residential Development Overview report revealed that despite approximately 80,000 dwellings sitting in the pipeline for development, only 5,369 homes are currently under construction across the region.

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Construction costs show mixed signals amid labour pressures. Source: Western Sydney Residential Development Overview

Projected of No. Households. Source: Western Sydney Residential Development Overview

The report confirmed the region continues to absorb the majority of the NSW population growth with 57.7 per cent of the state population increase and nearly 60 per cent of non-detached dwelling approvals.

South Western Sydney’s high growth accounting for 519 homes, significantly lower than the 7,335 required annually.

Ray White Commercial Western Sydney director Peter Vines said this is a housing crisis hidden in plain sight.

“The numbers suggest progress on paper, but the physical delivery of homes is falling dangerously behind,” he said.

Source: Western Sydney Residential Development Overview

Source: Western Sydney Residential Development Overview infographics

The updated demographic modelling has moderated annual housing requirements to 25,636 dwellings which is down from last year’s peak of 33,596.

This change in figure was reported not due to reduced demand, but instead growth expectations amid migration and housing pressure.

Mr Vines said the money is flowing but the homes are not keeping pace with investor appetite high, but limited stock holding back market momentum.

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Sydney’s West Precinct. Source: Western Sydney Residential Development Overview

Sydney’s North West Precinct. Source: Western Sydney Residential Development Overview infographics.

The October expansion of the Home Guarantee Scheme is set to add demand surge, however, Mr Vines said without new homes it risks fuelling price inflation rather than improving access.

With the South West precinct driven by Western Sydney Airport and multi-billion dollar infrastructure investment, Mr Vines said this is building an economic hub with nowhere for the workforce to live.

“If housing doesn’t keep up, the airport could become a policy failure,” he said.

While there are 80,000 dwellings in various planning stages, actual construction remains stalled.

Sydney’s Outer West Precinct. Source: Western Sydney Residential Development Overview infographics.

The gap between approval and project commencement is stalled by factors including land constraints, funding issues and bureaucratic lags.

The report states areas such as Parramatta and The Hills have shown promise due to the recent Transport Oriented Development (TOD) reforms designed to boost medium-density housing near metro stations.

However, there has been little to alleviate housing stress in the outer growth corridors such as Camden and Liverpool.

Mr Vines such reforms are helping areas that already have infrastructure but are neglecting the fringe communities that need the most urgent.

“Western Sydney isn’t just the future of NSW, it’s the present,” Mr Vines said.

“But if we don’t turn plans into homes, we’ll underestimate the entire growth model.”

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