The NSW government orders Sydney councils to prepare 30-year housing density plans just as the cost to build a typical mid-rise apartment pushes beyond $1 million. Rising construction costs outpace apartment sale prices so many developments no longer stack up financially for private developers.
The NSW Productivity and Equality Commission links these cost pressures to a growing feasibility gap across the city. It argues that planning and zoning rules now sit at the centre of whether new projects can proceed.
Under the Minns Labor government, councils must open up more land for development, a move that sparks strong resistance from wealthy inner-city areas such as Mosman and Woollahra. Those councils reportedly face a surge in apartment development applications as builders and investors rush to secure approvals under the new framework.
Local politics can slow down or reshape citywide housing strategies. Planning power has real financial consequences for both councils and developers.
The commission’s analysis finds that recent low and mid-rise planning reforms more than double the number of Sydney homes that are commercially feasible to build. It recommends deeper zoning changes to lock in those gains and extend them to more suburbs.
State mandates now collide with council resistance over how Sydney tackles housing supply and affordability.
