The NSW Government has welcomed the release of the Productivity and Equality Commission’s latest housing report, Review of Housing Supply Challenges and Policy Options for New South Wales.

This report was commissioned by Premier Chris Minns, who tasked Productivity Commissioner Peter Achterstraat with investigating and providing evidence-based recommendations about the barriers impacting housing supply, including in the construction industry.

The Commissioner was also asked to investigate barriers holding up the delivery of different housing and development types that are sought by renters and owner-occupiers.

The Review made 32 recommendations grouped into four key themes:

1. Free up construction capacity to build more homes quicky: Prioritise capital spending; rapidly remove barriers to density in the most feasible locations; and be sparing with subsidies for developers.  
2. Streamline the development process: legislate a mechanism to resolve bottlenecks, including after DAs have been approved; retain and improve infrastructure contributions; and create a pro-housing regulatory environment. 
3. Help the construction sector to deliver: shift the migration intake and recognise worker skills; grow the construction workforce and build capacity; and support innovation and productivity.  
4. Ensure a diverse and equitable supply of homes.  

The NSW Government is now considering the report and will develop an action plan that will identify which recommendations the Government can take up immediately with a priority placed on recommendations that will help unblock bottlenecks and support increased housing supply.

The review builds on critical analysis by the Productivity and Equality Commission in previous housing reports looking into how density can be done well and ideas on better land use.  

Today’s report provides new insight into why doing nothing is not an option. This follows the Commissioner stating in his last housing review, “If we don't act, we could become a city with no grandchildren.”

The paper found that between 2016 and 2021, Sydney lost twice as many people aged 30 to 40 as it gained. 35,000 came to Sydney, but 70,000 left.

It also found that while Sydney has among the highest average wages in Australia, over recent years, it has consistently lost population to other states and regional NSW.

While there is more to do, the NSW Government claims it has made bold strides to reform the planning system in NSW. 

This includes:

• Creating fairer housing targets. We’re rebalancing growth with a focus on well-located homes close to existing infrastructure.
• $253.7 million to continue the overhaul of the planning system and planning reforms.
• The largest rezoning in NSW history and the largest ever investment in the state’s history with $5.1 billion dedicated to delivering social and affordable housing.
• An international pattern book design competition to support our low-rise and mid-rise reforms and fast track pre-approved designs.
• A land audit of vacant government owned land that will unlock 30,000 homes including 8,400 public homes built by the government.
• Established a $2.2 billion infrastructure fund to make sure key infrastructure is in place to support development.

Premier Chris Minns said, "We won’t back away from the challenge ahead of us – building thousands of new homes near existing infrastructure for a generation of young people locked out of housing.

“The Commissioner warned in his last report that we’re at risk of being a city with no young people. Doing nothing is not an option.

“This means honestly assessing the conditions we are working in, and thinking innovatively about what we can do better like this report does.

“I want to thank Commissioner Peter Achterstraat for the work on this report.”

NSW Treasurer Daniel Mookhey said, “As it cites in its foreword, this report is ‘about looking our housing challenge in the face – it is also about practical solutions.

“We welcome the latest insights from the Productivity and Equality Commissioner and look forward to working through his recommendations.”

NSW Minister for Planning and Public Spaces Paul Scully said, “The NSW Government is confronting the housing crisis head on – and that means making sure we create changes to help increase housing supply.

“We’ve already introduced some of the biggest planning reforms in NSW history and are keen to consider and act on recommendations from important reviews like this from the Commission.”