NSW housing supply in the doldrums

15 December 2009

Todays Australian Bureau of Statistics new home construction figures for the September quarter confirm that NSWs new housing supply is lagging behind the rest of the country, according to the Urban Taskforce.

The Taskforces chief executive, Aaron Gadiel, said that, amongst the states, NSW has the lowest seasonally adjusted growth in new home commencements in the September quarter.


NSW and South Australia both saw only a 3.2 percent growth, compared to 8.2 percent in Victoria, 22.4 percent in Queensland, 13.8 percent in Western Australia, 4.9 percent in Tasmania and 9.4 percent nationally, Mr Gadiel said.


NSWs construction figures were buttressed by the work on a massive number of public housing units and townhouses in the quarter the highest number of construction commencements for high density public housing since 1992.


In the September quarter, work began on 637 high density public housing dwellings – more than four times the traditional level of public housing construction.


Mr Gadiel said the figures illustrate how heavily NSW private development is suffering.


Work started on 1,595 private sector higher density homes, compared with the previous 10 year September quarter average of 4,391 homes, he said.


In NSW private sector, construction of new apartments, terraces and townhouses is running at close to a third of traditional levels.


Mr Gadiel said that similar problems existed for greenfield development by private developers, however, this was masked in the Australian Bureau of Statistics figures by the inclusion of mum-and-dad knock-down-and-rebuilds.


The challenge NSW faces is securing community support for a resumption of development activity and making the tough decisions to make this happen, he said.


The NSW Government may need to override councils to ensure there are opportunities for new compact pedestrian-friendly residential communities, in the inner suburbs.


The Government also needs to reform infrastructure levies and bang heads together to get land released and developed in the outer suburbs.


The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.


For every $1 million in construction expenditure, 27 jobs are created throughout the broader economy.


The construction activity made possible by property developers contributes $78 billion to the national economy each year and creates 849,000 direct jobs.



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