ICC hosts local industry leaders, politicians to discuss Sydney’s future

Planning Minister Paul Scully has acknowledged that NSW has not achieved the national housing targets he had hoped for, but said recent planning reforms were starting to show signs of a turnaround.

Talking to people at a fireside chat reporter Editor Jordan Baker, Scully, said the state was “further behind than we’d like to be at this point” when it comes to delivering its share of housing under the National Housing Deal, which requires NSW to contribute to a target of 377,000 new homes by July 2029.

“But we’re starting to see a comeback,” Scully said. “Once you make changes to a planning system, it takes nine or 12 months for those changes to come into force or come to fruition.”

Scully pointed to the difficult economic situation as a key factor that has slowed down housing deliveries over the past two years. He said construction costs have risen sharply, with construction materials rising by nearly 30 percent, while high interest rates are weighing heavily on developers’ confidence.

“We also had a difficult interest rate environment, and this week’s decision did not help that,” he said, referring to the Central Bank’s decision to raise the interest rate to 3.85 percent for the first time since 2023.

“But we’re starting to see an increase. We’re starting to see a lot more projects coming down the pipeline.”

Baker questioned whether the NSW government had made a mistake by committing to ambitious housing targets that now appear elusive. Even if goals aren’t always met, goals are still necessary, Scully said.

“No, I don’t think so. We all have goals in life,” he said. “I’m sure a few people around here, like me, decided to lose a few kilos at the beginning of the new year. We don’t do these things all the time, but that doesn’t mean we shouldn’t lose weight.”

Asked if the government had an overarching vision to guide its reforms, Scully said the focus was on increasing density in built-up areas, particularly around transport hubs, to support Sydney’s growth as a global city.

“If we are going to be the kind of city that will attract people from around the world, we need people living in and around transportation hubs, connected to where job opportunities are,” he said.

Scully said the government’s reform agenda goes beyond just housing supply, pointing to changes aimed at improving Sydney’s liveability and economic activity. These include lifting caps on large events and encouraging outdoor dining. He said these measures were designed to “make Sydney more attractive” as both a place to live and do business.