Forecast insights

The department has prepared three growth scenarios to account for the continuing challenges COVID-19 presents to forecasting Sydney’s housing supply. These scenarios consider the current status of, and potential changes to, NSW’s market conditions and housing demand factors. The medium growth scenario represents the most likely outcome based on market conditions and demand factors at the time of preparing the forecast in October 2021. The low growth and high growth scenarios explore the impacts of potential changes to these conditions.

Overview

The department forecasts construction of 143,400 to 161,300 new homes in Greater Sydney in the next five years (2021-22 to 2025-26) based on current programs and initiatives and various market conditions and demand factors. Figure 2 displays the Sydney housing supply forecast by financial year.

Figure 2. 2021 Sydney housing supply forecast by financial year.

Greater Sydney Five-Year Forecast

The medium growth scenario estimates the construction of 151,500 new homes.

Major drivers include:

• the housing market impacts of COVID-19
• a pre-COVID-19 housing market slow-down
• a smaller number of homes under construction
• fewer new housing approvals
• an increase in the number of homes in the development pipeline that are approved for development but not yet under construction.

You can download more information in the Explanatory notes, glossary and data downloads section.