‘PERFECT STORM’: SUPPLY GOING BACKWARDS  HIGHLIGHTS NEED FOR NEW APPROACH

For new dwelling approvals to be declining at a time when the  housing supply shortage is at crisis point shows Government’s approach has  created a “perfect storm” and must be reconsidered now, according to the Real  Estate Institute of NSW (REINSW).

Australian Bureau of Statistics (ABS) data shows NSW dwelling approvals declined in  June by an appalling 19%. The 1,597 private houses approved in June is the lowest  recorded figure for NSW since January 2013, according to the ABS.

“The housing crisis continues to deteriorate on the back of a perfect storm of inhibitive  taxation, approval delays and rental reforms which discourage investment,” REINSW  CEO Tim McKibbin says.

“The data is screaming at Government and it’s time it listened,” he says. These figures highlight the dire, and worsening, housing crisis in NSW:

• Through immigration, the NSW population is increasing by over 15,000 people  each month (source: ABS);

• The average growth in the number of properties rented since September 2023 is  218 per month (source: NSW Rental Bonds Board);

• The total number of dwelling units approved in NSW fell by a disastrous 18.8% in  June 2024, including a 19% fall in private houses.

“Demand is rising fast and the supply gap is widening at an increasing rate. These are  perfect storm conditions which must be reversed now,” Mr McKibbin says.

“To do so, a new approach is needed. Government must stop driving investors out of the  residential market through anti-landlord reforms. These reforms reduce rental supply  and compound the dire situation for tenants.

“Government must urgently consider property taxation reform. The cost of new property  is inflated by 40% through taxes and charges imposed by various levels of Government.  It’s preventing new supply at a time when we desperately need more homes.
“Delays in development approvals must be eradicated. Councils which fail to meet their  housing quotas should have their planning powers revoked by the NSW Government. We  have run out of time for excuses.

“The housing crisis is not easy to solve. It is a long-term prospect. But Government can  no longer turn a blind eye to the data. Unfortunately, we are at the point where even doing nothing is better than the damaging decisions we have seen this week that will  only make the crisis worse.”