Property Council NSW Executive Director Katie Stevenson said the survey captures a cautiously optimistic mood tempered by ongoing economic concerns.
"NSW's property sector continues to demonstrate resilience in a tough operating environment," Ms Stevenson said.
"Confidence has improved up to 120 points from 107 points last quarter, and there's a positive outlook for residential and industrial property growth. However, staffing expectations and forward work expectations remain well below historical levels," she said.
Ms Stevenson said the survey period coincided with the announcements of the NSW Government's new Housing Delivery Authority, permanent Housing Taskforce and final master plans for seven Transport Oriented Development (TOD) Accelerated Precincts in Sydney.
"The NSW Government has delivered some solid reforms in recent weeks and months, many in response to consistent advocacy from the Property Council to identify and address systemic challenges in the planning system.
"The new Housing Delivery Authority can help to address bottlenecks but on the back of these and other reforms, we need to pick up the pace when it comes to delivery if we are to have any chance of meeting our National Housing Accord target of 322,000 new homes in Greater Sydney by 2029.
"While reforms introduced in the last 12 months will help to close the gap, the Department of Planning, Housing and Infrastructure's own current housing supply forecasts predict a shortfall of 150,000 new homes across Greater Sydney by 2029, so there's still a massive challenge ahead.
"Coupled with reports this week that the NSW Government is preparing to back track on key low- and mid-rise housing reforms that could deliver the bulk of the housing we need to meet targets, this slight improvement in confidence we saw in November may well be short-lived," she said.
The latest Procore/Property Council Survey for Q4 2024 was conducted from 11 to 27 November and included responses from over 350 industry professionals across Australia. Key insights include:
- Confidence Index: NSW confidence rose to 120 points, reflecting a strong uplift from 107 points in Q3 2024.
- Staffing Levels: The NSW property sector expects staffing growth over the next 12 months but at rates less than half the historical average.
- Forward Work Schedules: Respondents anticipate a steady pipeline of projects, similar to Q3 2024 but still below the historical average.
- Debt Finance Availability: Debt finance expectations saw a marked turnaround in Q4 2024 compared to the past two quarters, with NSW well ahead of all states on this measure.
- Residential Property Growth: Growth in capital values is expected to remain strong, in line with the national measure but still below other states including QLD, WA and SA.
- Industrial Property: Industrial spaces are forecast to grow, continuing to lead the market, while the office sector faces ongoing challenges with declining capital growth expectations.
- State Economic Growth: Sentiment around NSW's economic growth over the next 12 months has turned positive after two negative quarters but remains subdued, highlighting the need for ongoing reforms to boost confidence and investment.
- State Government Performance: Respondents remain negative towards the State Government's performance, though less so than in previous quarters. Housing affordability and supply, property taxes and charges and planning regulation and reform remain the key issues industry wants to see addressed by Government.
