NSW must keep up pace of construction to reach 2056 housing target

According to The Australian Financial Review, high-rise and high-density living will be the way of the future for NSW as the state plans 1.8 million new homes for 11.2 million people by 2056, the NSW intergenerational report released this week said.
The Future State NSW 2056 report says to get there NSW will need to build 45,000 dwellings a year over the next 15 years. Completions have averaged over 42,000 a year in each housing cycle except for the seven years to 2005, when only 30,000 dwellings completed.
But this plan will hit a snag as greenfield or new land available for development within a reasonable commuting distance to key job growth centres mainly in Sydney dwindle, particularly after the boom of 2012 to 2015.
More and higher developments on existing or brownfield land would be the best solution.
"This constraint is increasingly acute in Sydney, exacerbated by its particular geography," the report said.
"As a result, new housing supply will increasingly need to come from either a redevelopment of brownfields land or greater density in existing residential areas.
"Technology or additional infrastructure may make this easier to achieve. For instance, new technologies may reduce the costs of safely remediating contamination on old industrial sites."
Another challenge is the pace of construction.
Despite an uplift in residential construction since 2012 – construction approvals reached over 70,000 in 2015, the highest since data collection began in 1970 – NSW still has a housing under-supply of around 100,000.
The NSW government anticipates at the current pace of construction the gap will close in the next few years, after which NSW housing will again hit an under-supply.
But as long as NSW maintains the completion of 43,500 to 45,000 dwellings a year, the state will avoid the housing under-supply problem, the report added.
Looking back at housing statistics, this is an achievable outcome.
The Urban Development Industry of Australia said the government must not drop the ball on housing construction.
"The industry has been aware for a long time that NSW has been facing a supply crunch," UDIA NSW CEO Stephen Albin said.
"The Intergenerational Report confirms that the NSW government has been focused on reducing housing under-supply but will need to lift their effort over a sustained period to meet the shortage identified again in this report."

Ref: http://www.afr.com/real-estate/nsw-must-keep-up-pace-of-construction-to-reach-2056-housing-target-20160526-gp51u9
 
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