Western Sydney is facing a severe supply crisis, with just 5,310 apartments currently under construction to meet an annual demand of 24,178 new homes.

This shortfall, revealed in the latest report by RWC Western Sydney, underscores the region’s pressing need for more housing developments to support growing demand and stabilise affordability. 

“Western Sydney is in a precarious position,” said Peter Vines, Managing Director of RWC Western Sydney. “Demand is surging, but the construction pipeline is limited. The lack of supply under construction suggests we are falling well short of targets, which could drive affordability even further out of reach.” 

According to the report, the region’s housing demand is expected to continue at high levels, with 24,178 new dwellings needed annually through to 2041 to keep up with population growth and housing needs. Despite this requirement, recent data reveals a significant slowdown in new building approvals.

In September, monthly approvals in New South Wales dropped to a 14-year low, with only 662 dwellings approved—an alarming indicator of the construction industry’s current challenges. 

In Western Sydney, the South West precinct is experiencing the most substantial growth, with approvals rising by 25 percent. However, while the approval rates appear promising, completion timelines suggest that most projects in this area remain more than five years away from availability, falling short of the immediate demand. 

While development efforts are focused in some areas, only 5,310 units are actively being built across the region, illustrating a stark contrast to the required 24,178 units annually.

The bulk of projects is concentrated in the North West, leading with 3,988 units. These numbers, however, remain insufficient to meet the projected growth and address the housing affordability crisis. 

The RWC Western Sydney report calls for proactive measures and government support to close this construction gap, warning that without a coordinated response, Western Sydney may struggle to sustain its housing market and economic stability. With affordability already at risk, the report’s findings serve as a clear call to action. 

For a full breakdown of the data and insights, read the full report here. 

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