The New South Wales Government has announced an incentive scheme to encourage councils to meet newly rebalanced housing targets across the state.  

The State Government said that housing is the biggest single cost of living pressure people are dealing with, with mortgage payments or rent the largest expense for most households. 

A recent Productivity Commission report found between 2016 and 2021, Sydney lost twice as many people aged 30 to 40 as it gained.  

The State Government is committed to confronting the housing crisis head on – and that means building more well-located homes; close to infrastructure and transport links; next to amenities and work opportunities. 

Faster Assessments Council Incentives and Grants program 

To support this, the New South Wales Government has announced the first stage of an incentive program for local governments which meet and beat their housing targets. 

The program will reserve $200 million in grants for councils to fund more green space such as parks, sporting facilities and smaller pocket parks, plus maintenance of local streets and footpaths which Councils maintain. 

This is in addition to support already announced including through reforms to developer contributions of $1 billion over the forward estimates, and up to $700 million per year beyond that. 

This funding is reserved by the New South Wales Government to help fund schools, hospitals and roads to support the population growth that comes with new housing. 

An additional $1 billion raised through this contribution will also be directed to local councils over ten years for housing enabling infrastructure. 

Fairer Housing Targets 

The New South Wales Government said that it is delivering on its commitment to address the housing crisis by rebalancing housing growth across the state with a focus on well-located homes close to transport, jobs and existing infrastructure. 

The State Government also said that for a long time, Western Sydney has accepted the overwhelming burden of new housing in the city without proper infrastructure to cope with the increase in population. 

This plan is intended to ensure that the state is building more housing around established infrastructure, in places that are connected to work and transport, in communities that already have schools and hospitals. 

These five-year targets ensure that while all areas would see an increase in homes being built to help address the housing crisis, new housing will be more fairly balanced from the West of Sydney towards the East and North of Sydney. 

These targets do not mean additional housing over and above recently announced planning reforms – instead they will provide guideposts for local governments as well as access to financial support for future housing. 

This rebalancing has been developed with consideration of: 

  • Homes already in the pipeline 
  • The additional homes to be delivered from new planning reforms including Transport Orientated Developments and low and midrise reforms 
  • Constraints due to environmental risks like floods or bushfires 

Over the next five years 82 per cent of the housing targets come from infill areas with 18 per cent to come from greenfield locations. 

The government has said that these targets will be ambitious. In 2023, New South Wales delivered 48,393 homes, and the previous record number was 74,683 in 2018/19.  

Premier of New South Wales, Chris Minns, said that the state is losing too many young people, people who make the city vibrant, essential workers and young families because they can’t afford a place to live.  

“This has to change. I’ve talked a long time about the need to ensure we have a fairer balance of housing across the state – so housing is built close to already established transport links, schools and hospitals,” Premier Minns said.  

“While these targets are required to be released, the government has already acknowledged that they will be difficult to meet. 

“That’s why this government is pulling all levers required to reforming planning and setting targets for housing growth, while providing the infrastructure needed to build better communities.” 

New South Wales Minister for Planning and Public Space, Paul Scully, said that these targets are ambitious but realistic, because they’re based on evidence. 

“We all need to be accountable. For too long, housing has been delivered without a plan,” Minister Scully said.  

“The new targets make for a fairer distribution across Sydney and New South Wales, with growth in areas where jobs and transport exist or are planned for. 

“The good news is that nearly two thirds of homes are either planned, under assessment or under construction. 

“The state has already reformed the planning laws to improve efficiency and speed approvals.  We’re also investing $200 million to support councils with the infrastructure that builds better communities.” 

Local government response 

Local Government Association of New South Wales (LGNSW) President, Darriea Turley, said that LGNSW has long been calling for engagement on housing targets so that elected representatives and council staff can get on with the job of planning for the future.  

“Councils have an important role in addressing the housing crisis, but they do not build houses,” Cr Turley said.  

“It makes no sense for councils to be marked against whether new homes are completed when this is beyond the control of local government.”   

Cr Turley said that LGNSW welcomed the financial incentives for councils with the establishment of the Faster Assessments Council Incentives and Grants Program, as this move recognises the significant financial impost that increased density and population numbers will have on our communities. 

“We heard loud and clear from the Ministers that addressing the housing crisis is a collective action from all three spheres of government – we look forward to playing our part and working with the State and Federal Governments to get the housing solutions right. 

“Communities need to be supported by critical local infrastructure such as roads, public transport, parks, public schools and hospitals. 

“Local Government is best placed to know the challenges and the opportunities facing our communities and it’s integral that our voice continues to be heard in identifying those opportunities and in delivering solutions that are best for our communities.”  

Image: Shahram Babakhanian/ 


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