NIMBYs v YIMBYS: solving Sydney’s rental crisis and chronic housing shortage
The growing imbalance between demand and supply, as well as higher interest rates, is pushing Sydney and New South Wales rents through the roof and making life precarious for tenants and property investors alike.
After another increase in early May, the hope is that interest rates have now reached their peak.
The fact that house prices appear to have rebounded while rates were still trending upwards points to the resilience of the housing market.
It also points to the lack of supply.
CoreLogic figures show national house prices rose in April for the second consecutive month and at 1.3 per cent, Sydney led the charge.
Rents are rising too. As at March, PropTrack research showed Sydney experienced the second biggest year-on-year decline in the number of rental listings on realestate.com.au of 18.2 per cent. The number of inquiries per listing was up 16.7 per cent.
Unsurprisingly, the growing imbalance between demand and supply saw Sydney rents increase 11.3 per cent, according to PropTrack. For Sydney units specifically, CoreLogic data shows rents increased 5.8 per cent for the rolling quarter and 19.1 per cent for the year to April.
Action demanded on housing shortage
Everyone in the industry and an increasing proportion of the community recognises that supply is the problem.
The emergence of pro-housing YIMBYs (yes, in my back yard) to counter the NIMBYs (not in my back yard) represents an interesting shift in public perception.
As well as acknowledging the need for new development, it also signifies the community is increasingly fed up with all the talk about affordability and homelessness. People are demanding action.
In New South Wales, there aren’t enough homes to house our population. Support for first home buyers is needed as the challenge they face to buy property is greater than any other cohort but broadening the Home Guarantee Scheme, as well as a major uplift in immigration, will have significant demand-side impacts.
Everyone needs a home to live in. It’s a basic human right. But until we build more properties in the state, and nationally, this right is something not everyone is afforded.
As demand keeps increasing, the REINSW will keep pressing the urgency for supply-side solutions. Nothing short of radical action and a dual effort of Government and industry will stop the housing catastrophe that’s unfolding.
Part of the solution is to encourage people to invest in residential property. In recent times, anti-landlord regulations and politicians playing politics have done the opposite.
But the tide is changing here too.
The proposal by The Greens to initiate a rent freeze across the country was met with incredulity from many different sections of the industry and community.
There’s growing recognition of the fact that many investors are struggling to hold onto their properties. The latest rate rise won’t help and as such, the situation becomes more precarious for tenants.
Investors are just as concerned about the health of the market as everyone else.