Sydneysiders driven out by housing undersupply and congestion: Report

Larry SchlesingerDecember 8, 2020

Sydneysiders are leaving the city as it becomes increasingly congested and housing supply dries up, according to the federal government’s State of Australian Cities 2011 report. 

Between 2001 and 2010 Melbourne increased its population by more than 600,000 while Sydney’s grew by less than 450,000, with Sydney’s net population growth the result of international migrant arrivals outpacing departing local residents. 

In comparison, Melbourne remains a destination for many international migrants, but is also losing fewer internal migrants and consequently is growing more rapidly than Sydney. 

The report reveals the Sydney’s inner and middle city zones are becoming increasingly congested in comparison with Melbourne and Perth.

While the central local government areas of Perth and Melbourne both experienced rapid growth alongside Sydney as CBD and surrounding areas were redeveloped with higher-density housing, this trend was most pronounced in the City of Sydney, which added 52,530 residents and was a significant share of Sydney’s population growth (11.7%) in the period 2001 to 2010.

Overall, around 54% of Sydney’s population growth over the last 10 years has occurred in its inner city and middle city zones, with only 46% occurring in the outer suburbs. 

In comparison, 61% of Melbourne population growth has occurred in the outer suburbs, while more than two-thirds of Perth’s expansion (69%) has occurred on the outer edges of the city.

According to the report, Melbourne’s growth was concentrated on the city’s western, northern and south-eastern fringes with Perth’s population growth even more heavily concentrated in urban fringe developments, particularly those with coastal proximity.

In addition, Sydney is suffering from the state’s inability to build enough residential dwellings with NSW continuing to fall behind Victoria in the pipeline of new houses, semi-detached houses and apartments approved for construction. 

Figures for 2008 - 2009 and for 2010 - 2011 show that while NSW nearly doubled the number of apartments and units approved from 6,000 to 11,000 over these periods Victoria increased its pipeline from 6,000 to more than 17,000. 

Furthermore, while Victoria has over 35,000 houses approved for construction for 2010 – 2011, NSW has less than half that at just over 16,000.

Urban Taskforce chief executive-designate Chris Johnson says the report singles out Sydney for “dishonourable mention” and highlights that while there is a 200,000 housing gap between supply and demand, it is particurlarly severe in Australia’s largest city. 

“This report clearly shows that Sydney’s lack of new housing is driving people away from the city that they know and love,” Johnson says. 

Johnson says Sydney is not fulfilling its potential as a “hub for compact, pedestrian friendly living”. 

According to Johnson the housing supply crisis in Sydney and NSW is showing no sign of abating. 

“In the last quarter alone, work started on just 6,700 new homes in NSW, compared with 14,700 in Victoria and 6,000 in Queensland. 

“In fact, the June quarter saw new housing starts fall by 20% in NSW while Victoria saw an increase of 4.5%. 

“No capital city produces less homes per head of population than Sydney.” 

With large proportion of new jobs (50% to 70%) located in the outer suburbs in Sydney, Melbourne and Perth, Johnson says investment in new public transport to connect outer suburban communities to the urban core is vital. 

“It’s disappointing that the release of this report has not been accompanied by any commitment by the federal hovernment to fund the new and improved arterial roads essential for urban growth, nor any commitment by the federal government to fund the north-west rail link in Sydney.”

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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