Sydney’s housing affordability crunch is the result of a decades-long failure to keep pace with new developments in Brisbane and Melbourne, the NSW productivity commissioner has found, while also warning the city’s most affluent suburbs must become higher and denser to ease home prices.
“Everyone we talk to in focus groups and things like that, say, ‘Look, we want our children to be able to live near us. We want them to have a quarter-acre block, walk to the station and pay no more than a million dollars. We live in Lilyfield’. That’s not gonna happen,” said Achterstraat, himself an apartment dweller.
The answer is to adjust housing targets “to better match existing demand-supply imbalances” by building higher and more densely in the CBD and inner suburbs, where most people actually want to live, including along public transport lines.“Sydney’s housing costs could be lowered by allowing apartment heights [or floor-space ratios] above current levels, especially in inner suburbs,” the report stated.
“This means we need to build homes closer to the city as part of major train station developments such as Sydney Metro,” he said.“The size of our housing shortfall is now so large that all communities need to take their share to address the problem.” The commission used price-to-cost ratios – how much it cost to build apartments versus the return on a sale – to find unmet demand is far higher in Sydney’s eastern suburbs, north shore, inner west and CBD, compared to the south-west, where there was “relatively little excess demand”.