In a new pilot project, the NSW Government will explore how it can assist the construction industry to obtain finance and speed up the delivery of new homes.
The Minns Labor Government has already introduced the most significant reforms to planning controls in a generation to assist the faster assessment of development proposals.
But turning development approvals into actual homes is being slowed by a range of factors including the increased cost of building materials, labour shortages and access to finance.
The NSW Government will invest in a financing guarantee pilot which will examine how the state can more directly support the housing industry to secure finance, increase the viability of housing projects and speed up the construction of new homes.
Options to be explored include:
- Whether the state government should act as guarantor for some development loans when projects are assessed by financial institutions to satisfy debt requirements.
- Whether a government commitment to pre-purchase a specified number of houses could provide confidence to lenders, developers and builders to fund and start construction.
- Other options the state might adopt to support access to finance and improve materials supply and affordability.
The first step will be to develop guidelines in consultation with financial institutions and applicants.
Any final program would rely on well-established risk mitigation techniques practiced by government and financial institutions.
In addition, a review of housing supply issues will be led by the newly expanded Productivity and Equality Commission.
Premier Chris Minns has tasked Commissioner Peter Achterstraat with investigating and providing evidence-based recommendations about the barriers impacting housing supply, including in the construction industry.
Three housing reports by the Commissioner over the last year have provided crucial analysis to the government.
Mr Achterstraat, who has been reappointed for a further two years, will report back to government at the end of August.
Together, these further steps aim to help accelerate the delivery of new homes across NSW. And they build on investments already made in TAFE to help address skills shortages by supporting more apprentices in key areas like carpentry, plumbing and electrical trades.
This is part of the NSW Government’s plan to build better communities for NSW.
A plan to build a better NSW.
Treasurer Daniel Mookhey said:
“The Minns Labor Government is determined to explore every opportunity to deliver more homes, more quickly.
“Where governments can help to cut red tape or to safely speed up housing delivery, we should take a closer look. Doing nothing is simply not an option.
“I also look forward to new insights from the Productivity and Equality Commissioner to help us build on the planning reforms this government has already introduced.”
Paul Scully, Minister for Planning and Public Spaces said:
“We’ve introduced one of the biggest programs of planning approval and rezoning reform in NSW history to approve more homes, but we need industry to start the work of building houses.
“But getting an approval is not the same as building a house, which requires finance.
“The conversion of approvals into construction projects has slowed with developers reporting challenges accessing finance, building material price increases and labour shortages.
“Today we’ve announced measures to assist industry to build.
“The Guarantee Scheme will focus on the supply side to support developers with access to finance early on, so construction can be fast tracked.
