How Gen Z would save our city

Sydney needs an immediate housing investment akin to the post-WWII construction boom to stop the housing crisis turning into a catastrophe, a panel of the city’s future leaders has said.

The panel of six young experts, convened by the Herald, agreed that Sydney’s housing crisis is fixable, but that governments have only a short window to stop a mass exodus of young workers as housing prices balloon across the city.

Among the ideas suggested by the panel was a return to policies under which there was an explosion of housing growth following the return of soldiers and an influx of migrants in the mid-20th century.

National housing stock increased by 50 per cent from 1947 to 1961, in a period where one million new homes were delivered and homeownership rates increased from 53 per cent to 70 per cent. Federal and state governments funded one-quarter of post-WWII builds. The private sector was also instrumental in the housing boom.

Matthew Thrum, a 23-year-old urban planner at Ethos Urban, said responsibility to lead housing reform should lie with the federal government, which he said was treating the issue like a “policy footnote” rather than a crisis.

“They’ve got the deepest pockets of any level of government, and it’s time for them, like they did after World War II – the last time we’ve meaningfully solved the housing shortage – to step up and start getting involved in actually delivering housing and infrastructure,” Thrum said.

“Our governments have lost the capability to deliver housing. That’s something serious that we’ve lost in the last 60 years.”

When asked to rate the severity of the housing crisis on a scale from one to 10, no panelist thought the status quo was below a seven, while some thought the issue could rise to a 10 in the coming years if no substantial remedies were implemented in the short term.

James Ardouin, 25, a Liberal councillor at Woollahra, proposed the introduction of a local government funding vehicle, a mechanism the federal government was advised on in 2012 but never implemented, which could give “frontline” organisations greater options to increase supply.

“Councils are in a very unique position,” said Ardouin, who supported returning planning powers to councils but feared they lacked the funds to properly manage new builds.

“They have a lot of regulatory powers to push these things through in a really efficient manner.”

Zachary Moore, 23, an urban planning student who runs the City Connections YouTube channel, agreed that a historic housing boom was critical to salvaging a “very dire situation” He said “a lot more” transport infrastructure – especially in western Sydney and other areas earmarked for growth – would be required to keep up with new builds”.

“We’re going to have to be serious about building new rail lines,” Moore said. “We’ve been so lax that now we need to start building so much more infrastructure, so much faster. The bill is going to be just massive.”

Genevieve Heggarty, a 25-year-old graduate ecologist from the University of Sydney, said green spaces must accompany new transport hubs and builds. She said future generations would pay the price of one-dimensional planning reforms.

“If you create more housing for a city to have the capacity to fit more people without considering the livability of those houses, then you’re going to run into a greater problem down the line,” Heggarty said. “It really needs to be something that is not considered after the fact, it needs to be part of the discussion now.”

Amanda Eessa, a 22-year-old architecture masters student from Fairfield, went a step further, saying new builds must be supported by strong design principles that ensure sustainable living for Sydneysiders now and into the future.

“Instead of haphazardly building more, I think we should be building better,” Eessa said. “All these mass-produced grey boxes that are filling neighbourhoods and suburbs aren’t the answer.”

Transport-oriented development policy not a ‘silver bullet’

The panel, while broadly supportive of the NSW government’s transport oriented development (TOD) program, was critical of its implementation. The program has imposed new planning controls to accelerate medium-density housing near transport and high-use precincts.

“It’s a stopgap measure that’s never meant to be a silver bullet,” Ardouin said.

“You need that infrastructure to front-run any supply because, without infrastructure there, you’re going to have really bad outcomes for communities. You’re not going to have green spaces; you’re not going to have transport; and you’re not going to have industry.”

A review of the state’s future infrastructure projects, led by former federal infrastructure secretary Mike Mrdak and charting a path for six major rail projects over the next two decades, found up to $4 billion in annual capital spending would be required to provide transport corridors for new developments across the city.

University of Sydney economics graduate Sakshyam Pandey, 22, praised the TOD program as a promising short-term measure to address housing stress, but he said successful housing reform would come only through the “political will” of successive governments intent on seeing through a decades-long strategy.

“You need a party with more vision to have a long-term fix,” Pandey said. “You can’t just have one party who’s in for three or four years, consistently being churned out by another party.”

Thrum went a step further when asked about public transport policy, saying it was “time to give up on the roads” as Sydney becomes a denser city.

“Widening the roads is just going to worsen traffic,” Thrum said. “The more capacity you create, the more people decide to drive. But we have infrastructure, rail infrastructure, that has the capacity already to take a lot more people in a much more sustainable way.”

The panel was divided on policies to accelerate decentralisation.

Leading the proponents was Eessa, who is faced with hours-long daily commutes to work in the city centre and who found that a concentration of architectural firms in the CBD had undermined design standards for homes in western Sydney.

“We need to bring more incentives for designers working in the west and living in the west, and decentralising all the creativity and the innovation that’s happening in the city,” Eessa said.

“It will bring a new wave of creativity, innovation and development to housing design.”

Thrum questioned the practicalities of decentralisation, calling it a “noble goal” that was “really difficult” to execute.

“There’s a reason [architecture firms] are in the CBD, and it’s because they want to be close to their big clients, who unfortunately are in the CBD and will probably remain,” he said.

Outdated, takes forever – a lack of housing innovation?

Eessa had noticed a startling lack of fresh ideas around housing design, which meant much of the stock built in the past five years was unappealing or not up to standard.

“I’m interested in seeing the development of new, innovative materials and building methods, and I don’t see the government really pushing for that,” she said.

Pre-fabrication, or modular construction – when parts of a building are constructed offsite and put together at their final location – was widely used in Europe in the 1950s and 1960s. It’s more recently been adopted in countries such as Japan and Sweden, where automobile-style assembly lines can produce a one-unit building block in 30 minutes.

In November 2023, the Minns government committed $10 million towards a trial to build about 20 pre-fab social homes at sites in Wollongong and Lake Macquarie. Last month, federal Treasurer Jim Chalmers backed pre-fabrication as a way to make homes more affordable.

Eessa said the methods being taught to future tradespeople at TAFE courses needed to catch up fast: “It’s so outdated in terms of how to build, and it takes forever to build.”

A TAFE NSW spokeswoman said construction qualifications were developed with the industry to ensure students acquired the latest skills.

“This partnership … guarantees that TAFE NSW courses are modern, up-to-date, and tailored to meet the needs of industries, learners, and communities,” she said.

Pandey said making use of the state government’s new pattern book could increase supply while maintaining Sydney’s unique character, in much the same way as housing patterns did with the terraces of the early 1900s and the mid-20th century boom.

“If you actually have nice communities where there are parks, where there’s good infrastructure, where your kids can go out for a game of cricket or football … it won’t be viewed as, ‘Oh, we have to live in there’,” Pandey said.

“Living in an apartment shouldn’t be viewed as the worst-case scenario. It should be that Australians are actually looking forward to living in an apartment.”

The panel raised concerns about faulty builds and the erosion of public trust in property developers ahead of a housing boom. Fears of living in a “grey box” with waterproofing issues and poor design standards were among the issues that could limit supply.

“The last 10 years of apartment developments have eroded public trust in developments to an enormous extent, and now we’re proposing to quadruple the [number] of apartments we want to deliver,” Thrum said.

“Those defective elements that were malpractice are really coming back to bite us now.”

Who should foot the bill? Public, private sectors – and super funds

Pandey said a new boom would require much greater investment from the public and private sectors. He said government funding, such as the $10 billion Housing Australia Future Fund, shouldn’t just focus on building homes, but also on “enabling infrastructure” to unlock more sites for developers.

“The sewerage, the water pipes, the electricity, the parks, all those kinds of things,” he said.

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He said a key private player, Australia’s “giant” superannuation industry – worth $4.1 trillion in 2024, but with just 7 per cent of its assets in property – could make a greater contribution.

“The housing market does provide pretty stable and low-risk returns. That aligns with what a super fund already tries to do for investors,” he said.

Pandey said greater transport links, which the panel agreed were crucial, could be realised through public-private partnerships, which are popular in growing Asian economies, and also recently for the Sydney Metro.

Negative gearing and capital gains tax – a distraction?

The panel did not shy away from one of the housing crisis’ thornier issues, saying changes to capital gains tax and negative gearing should still be on the table.

But Pandey called for more nuanced public discussion on the policies, “instead of just having random populist rhetoric saying, ‘Oh no, you’re going to crash the housing market’, or ‘We’re going to fix the housing market’.”

Policy aside, the panellists spoke firsthand about the impact the crisis facing Sydney was having on a generation.

Ardouin said it was now impossible to buy a home on a graduate income.

“The banks aren’t willing to lend you the money to get on that first rung on the ladder,” he said.

Moore agreed, saying he had considered moving to Melbourne: “I can’t afford Sydney, I can’t even afford probably most areas surrounding Sydney.”

Pandey had seen many close friends and family leave Sydney for more affordable cities a decade into their careers.

Heggarty, a renter for six years, said she had seen “tens of thousands of dollars” disappear on rentals that had gone up in price, but down in quality and with less security.

“Even if you have secured the house and you’re struggling financially to pay rent, you could still leave your community … at any moment,” she said.

Eessa was uncertain about her own “dream of coming back to western Sydney, designing for western Sydney, designing for our communities”.

Thrum said Sydney risked becoming another popular but “chronically unaffordable” city like London, where there had been a substantially reduced quality of life for residents who stay, while many others leave for cheaper housing or better pay in Australia and overseas.

“If we want to maximise Sydney’s potential, we want to keep all those people.”