- Airspace development involves building new housing on top of existing apartment blocks.
- Airspace development could increase Sydney’s housing supply and put downward pressure on prices.
- Strata owners could generate up to $2 million in additional funds from unused space in their building
Airspace development, which involves building new housing on top of existing apartment blocks, could be an innovative solution to Sydney’s current housing crisis – according to an expert.
Founder of Buy Airspace, Warren Livesey, said airspace development is an obvious way to increase Sydney’s housing stock.
Sydney is in the grips of a housing supply crunch, with the NSW Government’s Intergenerational Report predicting the city needs an additional 1.7 million homes by 2060-61 to meet demand based on current population projections – over 40,000 new homes need to be built every year.
Mr Livesey said airspace development is helping address London’s housing crisis, and it has the potential to transform Sydney as well.
Mr Livesey said, “Every suburb needs to pull their weight – as you can’t increase Sydney’s housing supply with greenfield development alone.
“That’s because there is limited new land where homes can be built, even if you ignore all the infrastructure and zoning constraints“ he said.
The UDIA NSW Greenfield Land Supply Pipeline Survey said the Greater Sydney Megaregion was facing a shortfall of over 25,000 greenfield housing lots at best relative to demand by the 2029-30 financial year.
Mr Livesey said, “While you could go some way to hitting the target by replacing houses with apartment blocks in established suburbs, it would change the character of many areas forever – and could meet with significant local pushback.
“Both of those problems would be solved with airspace development or building new properties in the unused roof space in strata complexes.”
More affordable homes
According to Mr Livesey, airspace development could also help tackle affordability issues in Sydney.
“Airspace development wouldn’t just increase Sydney’s housing supply and put downward pressure on prices – it would also make it easier for owners to fund repairs and maintenance of their buildings,” he said.
“Strata owners who unlock the unused space in their buildings can generate up to $2 million in additional funds.
“This can either be put towards repairs and maintenance or paid out as profit for owners to spend as they like” he added.
Mr Livesey said that you need council approval and at least 75 per cent of the strata owners to support a project for the development to go ahead.
“I think both major parties need to talk about airspace development during this election as a potential solution to the housing affordability crisis.
“Right now, a lot of owners don’t know airspace development is an option and some councils are also still coming to terms with the concept” he said.
Mr Livesey said the state government needs to be more proactive to encourage an increase in supply: “Once the major parties put airspace development on the agenda, it will become front of mind for more owners and councils.”
“That should stimulate more development activity and increase Sydney’s housing supply, which is the key to putting downward pressure on prices” he said.