Developers will bypass council approvals in residential development overhaul in NSW

• By Alexander Lewis
• By Chantelle Al-Khouri
• Topic: Housing Policy
• ABC NEWS
• Fri 15 November 2024
  
  

Read this ABC News article by Alexander Lewis and Chantelle Al-Khouri, ABC News, Friday 15 November 2024

Councils will be stripped of the power to block certain large new residential developments in NSW, as part of major changes to the state’s planning system.

Premier Chris Minns on Friday announced a pathway for developers to bypass council approvals, in order to speed up approval and delivery times.

In an address to The Daily Telegraph’s Bradfield Oration, Mr Minns said the changes would be a new pathway to assess and approve spot rezoning at the same time.

“I’m sure some people will push back against it, but we’re making this call because we don’t have any time to waste,” Mr Minns said.

“Housing is the defining challenge of this age, [a] problem that breeds other problems.”

A new body named the Housing Development Authority (HDA) will sit within the planning department to head the process.

Leading the HDA will be three senior public servants, including Secretary of the Premier’s Department Simon Draper, Secretary of the Department of Planning Kiersten Fishburn and Infrastructure NSW CEO, Tom Gellibrand.

The authority will ask for expressions of interest for projects above $60 million in Sydney (on average 100 or more homes) and approximately $30 million (on average 40 or more homes) in regional NSW.

While developers may still choose to lodge an application through the existing process involving councils, the HDA will provide a quicker alternative that could slash approval times by years.

“For over a decade in NSW, governments have made it harder to build the homes we need, not easier – but this cannot continue if we want to be a city that young people can afford to live in,” Mr Minns said.

President of Local Government NSW Darriea Turley said the state government had dropped a “bombshell” with the announcement. 

“Putting three people in charge of approving developments across the state is certainly not democratic,” she said on Friday.

The reform is set to come into effect in early 2025.

NSW slipping behind dwelling approvals

The announcement comes after the finding that less than six months into a national race to build more housing, NSW is trailing behind.

The state needs to deliver more than 6,000 homes every month to reach its target of 377,000 homes in five years under the National Housing Accord.

But Australian Bureau of Statistics data showed NSW was approving just a fraction of the necessary stock, let alone building it.

Only 3,668 new dwellings were given the go-ahead in July — the first month of the accord — before slipping to 3,425 in August and 2,918 in September.

In the same period approvals in Victoria and Queensland rose.

The competition trying to speed up the delivery of homes

Despite the Minns government’s efforts to speed up the planning system, the number of new homes being approved in the state has decreased.

The government on Friday revealed the winners of the NSW pattern book design competition — all in the name of trying to quicken the delivery of new well-built homes across the state.

The current housing crisis has led to Sydney losing twice as many young people as it is gaining, with hope that innovative designs would help plug NSW’s housing shortage and retain people in the city.

Anyone who uses the endorsed pattern book designs would be given an accelerated approval pathway, the Minns government said.

The winning designs included terraces and mid-rise apartments.

Developments moving out of NSW

Tom Forrest is the chief executive officer of developer lobby group Urban Taskforce.

Mr Forrest said fewer development applications were being lodged in NSW because housing projects had become less feasible.

“We’re seeing the development community moving from Sydney out to Brisbane and Melbourne,” Mr Forrest said.

“If it’s not feasible, it won’t get built because the banks won’t lend the money to the developer to enable construction to start.”

Former state cabinet minister Stuart Ayres heads the Urban Development Institute of Australia (UDIA) NSW, a development industry body.

“When you’ve got high interest rates and high building costs, the cost to build for a developer often outstrips the price that future customers are willing to pay,” Mr Ayres said.

“There’s only certain parts of Sydney where projects are genuinely feasible and so therefore developers are less likely to take risk on losing money by building projects,” he said.

Blame is also being levelled at the NSW planning system which developers complain is slower than those of other states.

Mr Ayres said the longer projects stayed the planning system, the more they would cost to deliver.

“Those costs just get passed onto consumers,” he said.

New taskforce to go ‘line by line’ to unblock development

The state government has set up a secret task force to unclog the development pipeline.

It said the team had freed 13,000 homes in less than two months from bureaucratic blockages.

Planning Minister Paul Scully said the task force was going “line by line” through projects stuck in the system.

“A housing development in Newcastle that sat in the system for 865 days was unblocked within a week after the taskforce worked with Heritage NSW to get some additional information to complete the assessment,” Mr Scully said.

The planning profession rejected the idea that shortening assessment times alone would boost the delivery of housing.



Sue Weatherley, the Planning Institute of Australia’s NSW division president, said the higher costs of labour and land in NSW presented greater barriers to feasibility than approval times.

“Unless those things are addressed, tinkering on the edges of the planning system is not going to deliver more housing for NSW,” Ms Weatherley said.

“There is a desire for everyone to have a more efficient planning system, but if we think we’re going to solve the problem of housing delivery by improving assessment times by 20 per cent, I think we’ve lost the plot.”