The latest report by the NSW Productivity Commission continues its series of reports promoting more supply of new housing across Greater Sydney. The report, and its predecessors, support more density of housing across Sydney particularly in inner and mid city areas.
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Peter Achterstraat, the Productivity Commissioner, has clearly heard the NSW Premier’s call for more density to handle Sydney’s growth and has used an array of graphs and charts to present his case. His headline statement is that over the five years from 2017 to 2022, 1500 apartment buildings were built at an average height of seven storeys BUT if the average height had been 10 storeys then an extra 45,000 homes could have been provided.
Sound pretty simple, just increase heights and hope the no-one notices the extra floors.
In some ways Achterstraat is correct in that a little extra height keeps the impact of new development in places where it is appropriate for development to occur.
Once we go up with new housing we must accommodate underground car parking and lifts, particularly for older downsizers.
The rest of the NSW government hasn’t got the 10 storey message as NSW Planning is proposing to champion mid-rise housing that is capped at only six storeys.
The problem here is that once we go up with new housing we must accommodate underground car parking and lifts, particularly for older downsizers.
At only six floors, with a likely ground floor of retail, the feasibility gets very difficult. Sydney should follow Paris and Barcelona with eight storey heights with the top two set back from the street facade. Taller high rise apartment towers should cluster around transport nodes.
The report has many charts showing the drift of people away from NSW to other states and cities due to the excessive cost of housing. Achterstraat argues that the biggest gain of greater density will go to low and middle – income earners.
He uses figures from Auckland’s recent upzoning of three quarters of its residential land that generated planning permits for 22,000 new homes [Contested by analysis from some experts – Ed].
Most of the report is persuasive about the benefits of greater density and height. Two city maps showing density in 2022 in both Sydney and London demonstrate that Sydney is a very low density city compared to London.
But London has had a long history of urban development with its urban squares like Bedford Square and Lincoln’s Inn Fields which was built in 1659. Sydney with its extensive open spaces became a low rise city until apartment living began to become popular a few decades ago.
The major difficulty Sydney has in becoming more like the London map of density is that the low rise suburbs have over recent decades become conserved through a raft of Heritage Conservation Areas and of Heritage listings. The report’s Figure 17 map shows just how much of the inner and middle suburbs are now frozen. Achterstraat’s report states that:
“Today, around a quarter of residential zoned land within 10 kilometres of the city is subject to some form of heritage protection. Most of this (20 per cent of residential land) is conserved by by HCAs.”
So the very areas that London’s map has the highest densities are frozen in Sydney from new development by heritage orders.
The Productivity Commission report argues strongly that new housing density should be close to the Sydney’s CBD where new infrastructure is not so necessary compared to outer and fringe areas. While the report says comforting words about heritage such as “protect heritage in a strategic way that allows new homes in high- demand inner areas.”
The big difficulty in moving forward is the Heritage Conservation Areas and most heritage listings are by local government which generally don’t have a reputation for change. I was involved in advising recently on a development application that looked different to its neighbours and the council planners wanted the project to fit in as much as possible with the neighbouring houses. And this was not in a Heritage Conservation Area.
While councils will argue for their conservation areas and heritage listings I suspect they will also be negative about development that is close to the conservation areas so the 25 per cent of residential land with heritage protection could grow to 30 or 35 per cent if impact zones are included.
It is going to be interesting to see where Sydney’s growth can be located as the state government, councils and heritage supporters negotiate on where suitable land for more dense housing can be found. We may need a new definition of heritage conservation areas that allows generational change.
In Melbourne the YIMBY (yes in my backyard) Melbourne group have been encouraged by the NSW Productivity Report to measure their heritage protected areas. They find that 30 per cent of Melbourne’s residential land within 10 kilometres of the CBD is heritage protected and within five kilometres this rises to 56 per cent. The YIMBYs claim that “This is untenable for a city that wants and needs to grow.”
“Well of course he would say that”. Chris Johnson was the head of a developer lobby group. He and people in the housing construction industry have a serious conflict of interest. They have been aided and abetted by state and federal governments of both persuasions.
I do not live in a big city and have no skin in the game as far as heritage conservation areas are concerned, but I cannot agree with the destruction of heritage areas just to cater to the “missing middle”.
The push to build build build is too much. Yes there is a lack of affordable housing but the conventional narrative, and in the great majority of cases, the only narrative is focussed on supply. No thought is being given to moderating demand. Johnson’s piece only uses the word once and then merely quotes from the NSW PC report. That report also only talks of “high demand” and “in demand” without any reflection whatsoever on its varied nature and its impact on housing prices and its other externalities.
Increased human activity is the main cause of climate heating. The more people there are in the high consuming developed world the harder it will be to mitigate the effects of climate change. We’ve already missed our 1.5 degree deadline.
Yes build more affordable housing (of high quality) as soon as possible but we need to play the long game too: stabilise our population. Here and in other high consuming countries.
Construction and transport are the two biggest components of CO2 emissions.
Besides, we don’t need to be big to be successful: Iceland is one of the most prosperous countries in the world and its capital only has 123,000 people. The country itself has a density of 3.6 people /km2 , which is about the same as Australia.
Let’s see what they, and the other Nordic countries are doing as well as giving serious consideration to the causes of high demand and how to mitigate them.
thanks for your comments Chris. Discussion is always good…and debate even better at times!
but I need to take issue with the idea that’s taken hold lately that population is the reason we have climate heating. I think there is broad agreement from many people that it’s the fuel source that’s given us climate change. That and the massive consumption habits that go with a wealthy lifestyle in the west, which often calls on loads of energy to satisfy the demand of… There are other countries however that have more people, a simpler lifestyle and use way less energy. They have not contributed to climate heating at anywhere near the same proportion.
Thanks Tina for your prompt response. And yes of course most of the blame can be placed at the feet of people like us with our over-consumptive lifestyles. But you miss my main point completely: where is the analysis of the causes of the housing crisis? It’s not in the mainstream media or here at TFE. “Business as usual” hasn’t and won’t work. Until we identify the causes we won’t be able to solve the problem. I’d like to see a robust discussion about real tax reform, infrastructure provision, generational and jurisdictional inequality, the RBA and the role of monetary policy, the banking system and so on. Where is it ? Can we have it here? Can you encourage Chris Johnson to join us?
yes agree entirely we need a wholistic response – all the issues you mentioned. I get so frustrated at the YIMBY movement with their call for abundant housing. Not affordable housing. At least they are honest because a great deal of abundance will be needed to bring prices down – the experts say we don’t have the capacity to deliver so many houses or apartments to make them more affordable.
The YIMBYs have enough momentum by now, you’d think, to stir up change on the tax front, but one of their founders (I understand) is Peter Tulip, the deregulated-zoning-will-fix-all-problems man who says no, tackle planning but leave negative gearing and capital gains tax alone.
Reminds me of Lord Monckton on the radio in the early days when he said, tackle pollution by all means but don’t worry about carbon… leave that alone.
Ah yes, the libertarian cadre of the CIS: “get rid of regulation and let the market ( choose your own ending… amok / wild…). Simon Cowan did reply to an email of mine (once)!
I look forward to a 4C rise in my local temperature in summer because of the urban heating effect of eliminating open space, the remaining trees, and increasing hard, heat absorbing surfaces. This is insane. Build new cities on the coast, reduce immigration till we have the infrastructure, take the profit out of rezoning (Cameron Murray etc), take foreign money out of the motivation.