Approvals have nosedived in Sydney Olympic Park, once one of the city’s high growth areas.
NSW’s plan to build its way out of the housing crisis has been unravelling in some areas, with approvals for new dwellings wiped out in key suburbs that were once building powerhouses.
New ABS data analysis showed the number of approvals for new homes plunged by as much as 800 annually in several suburbs, resulting in a handful of new projects being greenlit.
Many were areas that had been among the state’s most active construction centres only a year earlier and still have room for further expansion.
They included the precincts Arncliffe–Bardwell Valley, Kellyville–West, Greenwich–Riverview and Wentworth Point–Sydney Olympic Park.
Each market had more than 450 new homes approved in the 2023–24 financial year, making them among the busiest development centres in Sydney.
That pipeline has since slowed to a trickle over the past financial year and only a handful of new dwellings were signed off by planning authorities – or in some cases, none at all.
Caringbah had one of the biggest drops in housing approvals over 2025.
Wentworth Point-Sydney Olympic Park was the standout: 480 new homes were approved in 2023/24 but none were approved in FY2025.
It was a similar story in inner suburb Haymarket: 433 dwellings were approved the previous year but there were no approvals in the most recent reporting year.
Another area where approvals plummeted was Caringbah in the Sutherland Shire, where 42 new dwellings were given the nod by council in the most recent year, down from 402 the previous year.
These drops defied what was otherwise an uptick in approval numbers across NSW, with a total 186,507 new dwellings approved over the 2025 financial year, up from 161,839 the previous year.
The stark reversal in some areas underscores the fragility of NSW’s housing supply efforts at a time when the state is grappling with surging demand, rising rents and worsening affordability.
Housing Industry Association economist Maurice Tapang said approval numbers were particularly alarming given that many homes approved by council didn’t end up getting built.
This would suggest the actual number of projects delivering new housing stock was not enough to meet ambitious housing targets under the National Housing Accord.
“The real increase in housing could be significantly smaller,” Mr Tapang said.
Urban planners said the figures point to a system struggling with rising construction costs, stretched council resources and lengthy assessment timelines.
Developers, meanwhile, have cited higher materials costs and labour shortages as reasons many projects have been paused or scrapped.
Metricon boss Brad Duggan said the approval process in NSW was too slow.
“NSW continues to struggle with lengthy and unpredictable approvals,” Mr Duggan said.
“Streamlining that process would unlock thousands of additional homes and send a clear signal to industry that the system can keep up with demand.”
New units were often only built years after getting the green light from council.
Mr Duggan added that the housing target of 1.2 million new homes by mid-2029 under the National Housing Accord was achievable if councils sped up the approval process.
“Builders can deliver homes quickly,” he said. “What we need is the land and approvals pipeline to match that pace.
“Across every major market, the story is the same: we have willing buyers and willing builders, what we need is a planning and land-release system that matches that ambition.”
ABS data showed the collapse in approvals in some pockets contrasted other Sydney areas where approvals were rising.
Castle Hill–Central, Zetland and Burwood topped the state for new housing sign-offs, with local councils each green-lighting more than 1,000 dwellings over the year.
These areas helped offset the steep declines elsewhere, but economists said NSW overall was not approving enough homes to meet its targets, which could put additional pressure on already inflated home prices.
– With additional reporting by Nathan Mawby
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