The Sydney housing supply forecast is the best available NSW government information on where, when and how many new homes are likely to be built in the Sydney area in the next five years.
The Sydney housing supply forecast is an annual product that informs us about potential future housing supply. It is not an indicator of underlying housing demand.
The 2021 forecast has some enhanced features: it is now available to download at ASGS 2016 Statistical Areas Level 2 (SA2) and greenfield precinct level.
The Sydney housing supply forecast is critical for strategic planning decisions both inside and outside government, as well as for monitoring expected housing supply in relation to underlying housing demand.
Key messages of the 2021 forecast
- From 143,400 to 161,300 new homes could be built over the 5 years 2021–22 to 2025–26 across 3 scenarios. We developed and released 3 scenarios to address uncertainty about the COVID-19 pandemic.
- The medium growth scenario forecasts 151,500 new homes over the 5-year period. This is the most likely outcome based on market conditions and demand factors at the time we finalised the forecast in October 2021.
- The share of housing supply we expect to be delivered across the Greater Cities Commission’s 5 Sydney districts – Central City, Western City, Eastern City, North and South – is similar under the different scenarios. We forecast that the most development will happen in the Central City and Western City Districts.
- Despite the effects of the COVID-19 pandemic, the NSW population will continue to grow and underlying demand for housing will remain strong. There is a need to keep delivering new housing for a growing and ageing population.
The COVID-19 pandemic had major effects on the way Australia functioned in recent years. Australia’s international borders closed on March 2020 and had partially reopened by November 2021. The full economic and social consequences of the pandemic for NSW and Sydney are still unknown, but the effects are ongoing.
The housing construction market
Recent years have seen a record high in delivering Sydney housing. Around 181,000 new homes were built between 2016–17 and 2020–21. In the 2018–19 financial year alone, around 42,400 homes were completed. This is the highest number ever recorded in one year.
This high level of growth happened on the back of strong housing approvals and starts, a healthy economy and record low-interest rates. However, in the 2020–21 financial year, the Sydney housing market continued a relative slowdown, with housing completions falling to around 29,800. This slowdown in part reflects the uncertainty surrounding the COVID-19 pandemic.
Demand for housing
The COVID-19 pandemic has been an unprecedented disruptive force but both the Sydney and NSW population will continue to grow. This means demand for housing will also continue to grow and we need to plan for the homes demanded by a growing and aging population.
Inputs and approach
The forecast approach considers:
- the current pipeline of residential development
- an analysis of likely future development under current zoning and planning controls
- planning proposals that have gateway approval
- information from state and local government and industry
- factors reflecting the outlook for housing demand and market conditions.
For more information:
Greater Sydney Urban Development Program dashboard
The Greater Sydney Urban Development Program (UDP) is the NSW Government’s program for monitoring housing and employment land supply. The UDP helps coordinate infrastructure in Greater Sydney. The Sydney Housing Supply Forecast is visualised on the UDP dashboard, with full details on the housing supply page.