Industry body welcomes requirement for councils to assess commercial viability of growth targets
The Property Council of Australia has welcomed an announcement by New South Wales Premier Chris Minns that development feasibility will be a central consideration in how local authorities plan for future residential growth.
The announcement follows the NSW Productivity and Equality Commission's report Building more homes where the numbers stack up. Under the new framework, the finalised Sydney Plan will require councils to demonstrate 30 years of feasible growth capacity when reviewing their Local Strategic Planning Statements.
"The measure of success is not how many homes fit in a planning document, but how many homes can actually be constructed and when," said Katie Stevenson, executive director (NSW) at the Property Council of Australia. "Our industry has consistently highlighted concerns since the end of the pandemic that escalating construction costs, infrastructure charges and financing pressures are making it increasingly difficult to deliver new homes."
According to Stevenson (pictured right), planning assumptions had for too long reflected theoretical capacity rather than what could realistically be built, and noted that NSW faced a target of 377,000 additional homes within five years, making commercial workability a critical factor.
"The renewed focus on making sure developments are economically viable builds on the existing work of the NSW government to support the delivery of new homes through the Pre-Sale Finance Guarantee, the bipartisan package of reforms to the planning system and a once-in-a-generation investment in social housing," she said.
"We look forward to working with the NSW government on the details of a consistent feasibility framework and the development of practical tools that will help councils understand where and under what conditions new housing can be delivered."
In its submission on the Sydney Plan, the Property Council recommended developing a consistent feasibility framework for local councils, incorporating standard assumptions and inputs informed by industry expertise that more accurately reflect prevailing market conditions.
The Property Council said it would host its Western Sydney Feasibility Fixer Breakfast on 11 August, bringing together industry and government representatives to examine conditions in the region's apartment market and identify potential reforms to support housing supply.
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