SYDNEY’S housing crisis is contributing to the city losing around 7,000 people aged 30 to 40 to other more affordable states every year, and new data from Homelessness NSW reveal increases in the inner west and Canterbury-Bankstown Council areas.
According to the NSW Productivity Commission, between 2016 and 2021, Sydney lost twice as many people aged 30 to 40 as it gained, with 35,000 entering Sydney and 70,000 leaving.
Around two out of every three departures are from the city’s working-age population, or those aged between 25 and 64.
People are leaving Sydney, despite it sitting among the highest average wages in the country.
“The reality of rising housing prices and lack of available housing is making it harder for people to stay in the same suburbs as their families or live close to their jobs,” said Paul Scully, minister for planning and public spaces.
“That’s why the Labor government has introduced the boldest housing reforms in 12 years, we’ve created new housing policies that are designed to get supply moving and overcome this problem.”
The paper supports the state government’s rezoning and density plans, including building up in inner-Sydney suburbs to boost productivity, wages, cut carbon emissions and preserve green space.
“If there’s no supply, there’s no homes for the next generation. The NSW Government is not going to turn their back on housing, it’s a basic need,” added Scully.
The paper found that a city like Sydney with high levels of productivity and amenity should naturally attract new arrivals, from interstate or from overseas.
While ideally, newcomers would be accommodated by a growing housing stock, with only marginal increases in housing costs but if new home building is slow, population growth will also slow and prices and rents will rise.
Crucially, any new housing stock will as a result be only available to those with the greatest financial means.
“In this sense, high housing costs operate like a regressive tax, with the burden falling disproportionately on low income renters and future generations,” read the paper.
The report found that the parts of Sydney previously identified as having the largest shortage of apartments also have the highest average incomes, due to conditions meaning only high earners can afford the high home prices and rents.
In 2021, nearly twice as many upper-income households lived within five kilometres of the CBD compared to the lowest income households.
As a result, most low-income households have no choice but to live where jobs are harder to come by, where public amenities like the beach are less accessible, and where it is hotter, meaning living costs rise for those least able to meet them.
In New South Wales, the lowest-income households in the state spent a massive 33% of their income, on average, on housing in 2019/20, which is in range of housing stress.
This is more than three times what the richest households spent on housing, at around 10% of their income.
Renting households in Greater Sydney are particularly worse off, with low-income households spending between one-third and half of their after-tax income on rent in 2021.
Lower housing affordability ultimately means that low-income households have less money leftover to save or to cover other expenses, making them far less resilient to major negative events like losing a job, unanticipated medical expenses, or cost-of-living increases.
Making low-income households far more vulnerable to homelessness.
Additionally, new data from Homelessness NSW has found that many who have been priced out of housing in Sydney and can’t afford the significant of relocating are increasingly being pushed into homelessness.
The analysis reveals that the top council areas that have seen increases in homelessness numbers are Inner West and Canterbury-Bankstown Council areas.
“This report, together with the new data released today from Homelessness NSW highlights the very real housing crisis that is playing out in our suburbs and cities across the state,” said Rose Jackson, minister for housing and homelessness.
“There are more than 55,000 people on the social housing waitlist, anxiously waiting for a safe place to call home.
“Affordability and availability are at their lowest levels in decades. The NSW Government remains committed to delivering more homes and strengthening support services as a priority,” added Jackson.
While the Greens want to see revenue raised from changes to the capital gains tax and limits to negative gearing injected into more public housing and are blocking the federal government’s Help to Buy scheme, which would only support a 0.2% of eligible home buyers each year.
