NSW councils urged to unlock surplus land for affordable housing — what it means for agents
The NSW Government has released a new step-by-step guide designed to help councils identify surplus operational land and convert it into affordable housing – a move that could open up new development pipelines across the state.
The Council Led Affordable Housing on Operational Land Guide, published by the NSW Office of Local Government, outlines how councils can audit underutilised assets, such as former depots and vacant facilities, and fast-track them into housing projects.
For agents, this signals potential new stock, particularly in well-located infill areas close to transport and established amenities.
With NSW currently projected to fall around 156,000 homes short of its 377,000 target by mid-2029, supply remains a critical issue. More than 57,000 households are currently on the social housing waiting list, and demand is continuing to rise.
Under the National Housing Accord, NSW has committed to delivering at least 3,100 new affordable homes by June 2029, and council-owned land is emerging as a key workaround to rising land acquisition costs.
Several projects are already underway. Shoalhaven City Council has converted surplus land in Bomaderry into 39 affordable units, while Lismore City Council is partnering with Landcom and Homes NSW to deliver 56 new dwellings.
Planning Minister Paul Scully said the initiative builds on the government’s land audit program and previous projects, including build-to-rent housing for essential workers in Annandale and Chatswood.
The broader context is important for agents. The NSW Government has set five-year housing completion targets for 43 LGAs across Sydney, the Illawarra-Shoalhaven, Lower Hunter and Central Coast, alongside a statewide regional target.
The draft Sydney Plan also proposes mandatory affordable housing contribution schemes for all Sydney councils.
For agents operating in growth corridors or established infill markets, this could mean:
- New development listings coming to market
- Increased affordable and build-to-rent stock
- More council-led partnerships with community housing providers
- Greater focus on compliance with affordable housing contributions
Housing Minister Rose Jackson described the guide as a practical tool to help councils “get more projects off the ground.”
