Bottlenecks in the planning system,the increased cost of building materials,labour shortages and access to finance are slowing the construction of homes in NSW at the same time as the state needs to build 75,000 new homes a year.
The NSW government wants to give lenders confidence to lenders to fast-track construction.Dominic Lorrimer
In response,the government will invest in a new financing pilot,which will examine how the state can directly support the housing industry to secure finance,increase the viability of housing projects. and fast-track the construction of new homes.
Under the scheme,the government will prepurchase a specified number of homes and consider whether it should act as a guarantor for some development loans when projects are assessed by financial institutions to satisfy debt requirements.
Planning Minister Paul Scully has referred to the pilot as the “government’s version of the bank of mum and dad”,which would form another plank of the NSW government’s drive to dramatically boost density.
“We’ve introduced one of the biggest programs of planning approval and rezoning reform in NSW history to approve more homes,but we need industry to start the work of building houses,” he said.
“But getting an approval is not the same as building a house,which requires finance,and the conversion of approvals into construction projects has slowed,with developers reporting challenges accessing finance,building material price increases and labour shortages.”
As well as the finance pilot,the government has asked the newly expanded Productivity and Equality Commission to review housing supply issues.
Premier Chris Minns has tasked commissioner Peter Achterstraat with investigating and providing evidence-based recommendations about the barriers impacting housing supply,including in the construction industry.
Achterstraat has already provided three reports over the last year,which the government says have provided crucial analysis of the housing crisis,including one where he warned that “if we don’t act,we could become a city with no grandchildren.”
His next report is due at the end of August.
Technology push
The government will also try to fast-track building approvals by spending $253 million in Tuesday’s budget on more planners and technology to push applications through the planning system.
Scully said the investment would mean faster state rezonings and assessments,including for major renewable energy projects,and an upgrade to the government’s planning portal,which has been heavily criticised by sections of the building and development industry.
He said the extra investment would also help the government with its signature planning reforms,including the transport-oriented developments and the low- and mid-rise program.
“This increased funding will allow the assessment of more housing and major projects within the Department of Planning,Housing and Infrastructure,so assessments are faster,more coordinated and efficient,” Scully said.
“We are also investing in the planning portal to address concerns users have identified and to continue to introduce artificial intelligence to assist in faster and more reliable assessment processes.”
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