How the NSW Budget will tackle the state's housing crisis
The New South Wales Government revealed today it will allocate $2.2 billion to address the state's housing supply and affordability issues.
State Treasurer Daniel Mookhey said most of the money – $1.9 million – will target long-term infrastructure, noting that such works are just as crucial as building actual homes.
Specifically, the government wants important infrastructure like roads, sewers, lighting and footpaths to help drive home building in growing areas. It appears that the focus of these works will be on the city's fringe, but some money could be used for projects in inner city areas as well.
In addition, the state will dedicate $300 million to state-owned developer Landcom to develop around 4700 homes. About 30% of these homes must be offered at affordable below-market rates.
In its 2023-24 budget paper, the government called housing affordability and availability the biggest single pressure facing the people of New South Wales, noting that, "New South Wales is experiencing an unprecedented housing crisis, driven by higher interest rates, escalating rental costs and an insufficient supply of social and affordable housing."
To combat these issues, the paper suggests infrastructure can help increase housing supply, with timely provision critical to both the delivery of new homes and in creating communities that meet the needs of residents.
Of course, an obvious lack of housing supply in Sydney has helped fuel dramatic price jumps in the city over recent years. While this situation has benefited existing property owners, it has severely hindered the first home buyer market in the city.
The government reports that between the start of 2020 and May 2023, home prices have grown 28% across Greater Sydney. More homes – and affordable options – may ease the impact of such rapid price gains.
You can read more about the NSW Government's 2023-24 Budget on its site.
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