Sydney and surrounding areas will barely reach half of its share of the national housing target, developers say.
A report released on Thursday forecasts a shortfall of 150,000 homes by 2029, mainly due to a slow planning system, a lack of enabling infrastructure and environmental constraints.
Under the national goal to build 1.2 million well‑located homes over five years, about a quarter are due to be built in Sydney, the Central Coast, the lower Hunter and Illawarra-Shoalhaven.
Closing the gap required immediate government interventions on top of those already underway, the NSW division of the Urban Development Institute of Australia said.
"Waiting any longer before taking corrective action on housing supply, will only ensure more people are denied an opportunity for a place to call home," UDIA NSW chief executive Stuart Ayres said.
"Meeting our housing objectives will not be resolved by one lever alone.
"We need to see a diversity of typologies, increased investment in enabling infrastructure, and the government genuinely prioritising housing supply."
The forecast is a combination of UDIA's developer intentions survey, CoreLogic's Cordell database, and government housing supply forecasts.
It finds homes are held up in the planning system, with 42 per cent of potential homes waiting at least one approval determination before development can commence.
Another 30 per cent of potential homes are delayed by a lack of committed, funded, or completed enabling infrastructure such as water and power.
More than half of vacant land in the region is prone to flood or bushfire or otherwise environmentally constrained.
Housing supply has been a long-running issue for NSW, with population growth in the early 2010s leading to a shortfall of 100,000 dwellings by 2016.
After a short-term spike, completions have fallen back below 50,000 per year statewide.
About 46,000 homes were completed in the year to March 2024.
Labor has introduced planning system revamps and reforms to encourage well-located six-storey apartment complexes.
Facing budget estimates on Wednesday, Premier Chris Minns criticised the coalition for overseeing "the slowest planning department".
"Building, construction ... new homes for people, mining, planning - everywhere you look in NSW planning was a disaster," he told opposition MPs.
Planning Minister Paul Scully said a lot of work was needed to meet the 2029 housing accord target but planning reforms and the 73,000 homes under construction would help,
