By Stephen Donachie, University of Technology, Sydney

18 October 2012 — Sydneysiders are looking towards established Sydney suburbs and apartments closer to the CBD according to the Bureau of Infrastructure, Transport and Regional Economics report, released on 30 September.

Examining population data over the past decade the report shows that there has been a gradual decrease in Sydney suburb growth rates since the 1960s and 1970s. This is not a surprising trend. With Sydney housing prices now 9.2 times the median household income the reality is that Sydney is living in housing stress.

The recent COAG report stated that only 24 per cent of the properties on the Sydney market were affordable to the lowest 60 per cent of incomes. This means that 60 per cent of households are competing for 24 per cent of the reasonably affordable properties in Sydney. These figures are continuing to rise with more and more households stretching their budgets.

As a result, reports show an increase of inward migration towards the CBD. The popularity of medium and high density housing is growing seven times the rate of stand alone homes. The drive towards smaller household units is a reflection of the changing Sydney demographic.

Wendell Cox, principal of Demographia, states that the demand for one and two person households is increasing and this is expected to continue to 69 per cent by 2036. Chris Johnson, former NSW Government architect and chief executive officer of Urban Taskforce Australia, suggests that this growing trend could lead to more social, livable and sustainable suburbs.

“Generation X and Y are more interested in living closer to where the action is than way out on the outskirts, and the planners need to understand this,” Mr Johnson said. “People are going to have to live in a more communal way and I think that is a positive. Instead of each house having a pool, everyone will have to share, the same with cinemas and gym facilities. People will become more social.”

With a desire for generation X and Y residents to be better connected to the work and nightlife that the city offers, the State Government needs to drastically address Sydney’s housing future and accommodate growing population densities along major transport corridors. Currently 200,000 people from western Sydney commute to and from work each day. With such an intense demand on transport infrastructure, developers say the government needs to shift the focus towards medium and high density housing developments closer to the city.

Already developers have targeted councils along the Parramatta and Victorian roads corridors and are declaring a need for more units to be built to meet demand. There has been major debate in recent times that the great degree of planning controls and council restrictions stifle growth and development along such transport corridors. These bureaucratic obstacles further add to the already strained housing market.

The recent release of the NSW Planning Green Paper has introduced three new zones to “address the problems within the current zoning framework”; the enterprise zone, future urban release zone and suburban character zone. With developments subject to fewer controls, the introduction of the enterprise zone is intended to encourage innovation and investment. This has been welcomed by developers.

However, the Independent Commission Against Corruption warns that the increased flexibility of the system could promote corruption and undermine public confidence saying, “lack of certainty is a key cause of inconsistent decision making which undermines public confidence in the planning system … there is the potential that it will create a corruption risk, especially when combined with the potential for proponents to obtain huge windfall profits through obtaining an approval”.

The ICAC has supported several proposals within the Green Paper but notably calls for “strong processes to be established, including defined design quality standards and evidence to justify land uses”.

With such a vague set of criteria outlined in the Green Paper the public now awaits the release of the white paper later this year. The hope is that it will clarify the concerns and provide certainty concerning new policies that will guide future housing supply, transport infrastructure and the densification that Sydney now demands.

Stephen Donachie is a student at the University of Technology, Sydney