The Pulse | 8 October 2025

Solar's Bright, But Housing's Tight

This edition of The Pulse examines a NSW construction sector characterised by clear contrasts.

On one hand, national infrastructure projects are gaining momentum, with major construction moving forward on the HumeLink transmission line, progress on Snowy 2.0 and approvals for large-scale solar farms [3, 13, 18, 21, 27]. This signals a robust pipeline of government-backed work, particularly in the renewable energy and transport sectors, creating substantial commercial opportunities [9, 20]. 

On the other hand, the residential sector faces a disconnect, with a recent report released by Ray White Commercial Western Sydney revealing 80,000 approved homes in Western Sydney are not being built, threatening to undermine major investments like the new airport [26]. 

The government is responding with further initiatives to unlock land and fund enabling infrastructure, while the Build-to-Rent sector continues to grow with a national pipeline exceeding $30 billion [1, 4, 16, 19]. 

Amid this push for supply, regulatory oversight continues, with the Building Commission conducting ongoing regional programs to enforce standards and ensure quality is not lost for quantity [2]. 

Energy & Infrastructure Overhaul Gathers Pace

The NSW infrastructure overhaul, driven by the state's energy transition and long-term transport strategies continues. The HumeLink project has officially commenced major construction, a key step in strengthening the southern electricity grid and integrating renewable energy [13, 22, 27]. This $4.8 billion, 365km transmission line is essential for unlocking the full capacity of Snowy 2.0, which itself is progressing with the arrival of its fourth tunnel boring machine [3, 21, 27]. Together, these projects are designed to add 2,200MW of on-demand energy to the grid, supporting the government's 2035 climate targets [13, 27]. 

The renewable energy pipeline is further bolstered by the approval of the $1.3 billion Tallawang Solar Hybrid project near Gulgong, which will power 212,000 homes and create 420 construction jobs [12, 18]. 

Beyond energy, major transport projects continue to advance. The Hunter region has a new Strategic Regional Integrated Transport Plan outlining 49 actions and over 20 road projects, backed by more than $4 billion in current works [9]. Simultaneously, construction on the 1,600km Inland Rail freight line is expected to provide sustained benefits to regional NSW communities through to 2027 [20]. 

These state-shaping projects represent a multi-billion dollar pipeline of work, creating thousands of jobs and significant opportunities for contractors in civil, electrical and tunnelling works [3, 12, 27].

Housing Policy Under Pressure as Supply Gap Widens

Despite a clear government focus on the housing crisis, a notable gap between policy and delivery continues, particularly in Western Sydney. 

A recent report published by Ray White Commercial Western Sydney highlights that while approximately 80,000 dwellings have been approved in the region, only 5,369 are under construction, creating a substantial shortfall that could impact investments like the Western Sydney Airport [26, 15]. 

Beyond Western Sydney, the Minns Government continues to identify surplus government-owned sites, recently unlocking land for over 600 new homes through land audits [19]. To accelerate construction, designs from the NSW Housing Pattern Book are being promoted with a 10-day expedited planning approval pathway [19]. 

In regional NSW, the government is offering financial incentives, including up to $20.9 million in interest relief, to help councils deliver enabling infrastructure inclusive of roads and drains needed to unlock new housing developments [1, 4]. 
In addition, the market is seeing a structural shift towards alternative housing models. The national Build-to-Rent (BTR) pipeline has grown by 35% in one year to a value of over $30 billion [16]. This is supported by direct government action, with Landcom leading a $450 million program to deliver BTR communities for essential workers in locations like Chatswood and Annandale [5]. 

While these initiatives signal a multi-pronged approach, the scale of the construction lag in key growth corridors remains a core challenge for the industry [26].

Regulatory Focus on Quality and Compliance

As the government pushes to meet housing targets, regulatory bodies continue to ensure construction standards are upheld. The Building Commission NSW recently concluded a three-day inspection blitz on the Mid North Coast, visiting 41 sites and issuing 13 rectification orders and 22 penalty notices totalling nearly $18,000 [2]. 

The crackdown targeted defective work, unlicensed contracting and insufficient supervision, emphasising the government's mantra of not foregoing "quality for quantity" to meet the National Housing Accord's target of 75,000 new homes annually in NSW [2]. 

The approval of the $1.3 billion Tallawang Solar Farm came with clear conditions imposed by the Independent Planning Commission (IPC) [12, 18]. These conditions mandate detailed plans for biodiversity, fire safety, traffic management and worker welfare, demonstrating a thorough approach to mitigating impacts of energy projects [12]. 

Green Finance and Technology Signal Future Trajectory

The NSW construction industry is being reshaped by technological innovation and a market-driven push for sustainability. A significant catalyst is the growing availability of green finance, with NAB reporting it has delivered over $2 billion in new green business loans, a large portion of which has been directed to the commercial real estate sector [17, 23]. 

This capital is funding projects that meet high environmental benchmarks, such as a NABERS rating of 5.5 stars or a 30% reduction in emissions for retrofits, creating a clear commercial incentive for sustainable construction [17, 23]. This trend is complemented by technological advancements, with next-generation solar cells developed by Sydney researchers promising cheaper and more efficient energy solutions for buildings [14]. 

At a strategic level, the NSW government has signed a Memorandum of Understanding with Singapore to foster cooperation in the green economy and urban development, aiming to attract investment and innovation to precincts like Tech Central [7]. 

To address productivity and labour shortages, there is a growing call for the industry to embrace AI and robotics, mirroring a US trend where billions are being invested in jobsite automation [8]. Adopting these technologies is seen as essential for reducing build times, lowering costs and achieving the National Housing Accord's ambitious targets without overstraining the workforce [8].

Takeaways

Navigating State Significant Development & Planning Pathways

The approval of several major projects, including the Tallawang Solar Farm [12, 18], ESR's Westlink Industry Park [25] and the Crows Nest "Five Ways" tower [11], underscores the key importance of the State Significant Development (SSD) planning pathway in NSW. 

For developers and contractors, this presents both an opportunity and a challenge. While the SSD pathway can provide a more direct route to approval for large-scale projects, it involves a detailed assessment process with legally binding conditions of consent. These conditions can cover everything from traffic management and biodiversity offsets to worker accommodation and decommissioning plans [12]. Furthermore, the government's introduction of a 10-day approval pathway for designs from the NSW Housing Pattern Book [19] represents a regulatory streamlining effort.

Professionals must remain adept at navigating these varied and complex approval frameworks, ensuring comprehensive due diligence and a capacity to meet conditions to de-risk projects and avoid costly delays.

Compliance with Building Standards Amidst Housing Push

The recent inspection blitz by the Building Commission NSW serves as a reminder of the legal and financial risks associated with non-compliance [2]. The issuance of rectification orders and Penalty Infringement Notices (PINs) for issues like unlicensed work, non-compliant electricals and inadequate supervision highlights the regulator's focus on enforcing standards under the Home Building Act 1989 and other relevant legislation. 

With the government publicly stating it will not sacrifice "quality for quantity" [2], builders and contractors must assume that regulatory oversight will remain strong, even as pressure mounts to increase housing supply. This environment elevates the importance of compliance with the Design and Building Practitioners Act 2020 (DBP Act), which imposes duties of care and requires design and building practitioners to declare that their work complies with the Building Code of Australia. Failure to comply to these standards can result in substantial penalties, loss of licence and liability for defect rectification. Proactive compliance, robust quality assurance systems and thorough supervision of all trades are essential risk mitigation strategies.

Capitalising on Green Finance: The Role of Certification

The influx of over $2 billion in green finance from institutions like NAB is creating a direct link between a project's environmental credentials and its financial viability [17, 23]. For developers and builders, this is no longer just a matter of corporate social responsibility; it is a commercial obligation. 

Access to this capital is tied to meeting recognised industry benchmarks such as a 5.5-star NABERS rating or a 5-star Green Star Design review rating [23]. This means that the design and construction phases must be meticulously planned to achieve these certifications. Contractual arrangements should clearly define responsibilities for meeting these standards and project teams must include professionals with demonstrated expertise in sustainable design and construction. 

Failing to achieve a specified rating could not only impact the project's marketability but also jeopardise its financing arrangements. Integrating these environmental performance targets into project planning from the outset is now a key risk management strategy for securing favourable funding and delivering commercially successful assets in a market that increasingly rewards sustainability.

Final Thoughts 

The NSW construction landscape continues to be a dynamic arena of scale and complexity. The unprecedented investment in energy and transport infrastructure provides a long-term pipeline of secure, high-value work, anchoring the sector's growth [27, 9]. 

However, this momentum is contrasted by the ongoing challenges in the residential sector, where the gap between housing approvals and commencements poses an economic risk [26]. 

For professionals, the path forward requires a dual focus. Firstly, aligning with strategic government priorities, be it renewable energy infrastructure, regional housing or BTR projects, is key to unlocking opportunities [5, 12, 19]. Secondly, a disciplined approach to compliance and quality is non-negotiable in a climate of increased regulatory assessment [2]. 
Success will be defined by the ability to navigate complex planning pathways, manage project risks effectively and embrace the innovations in technology and sustainable finance that are shaping the industry's future [8, 23].

1. The Daily Mail (8 October 2025). Infrastructure 'key' offers to unlock regional housing. https://www.dailymail.co.uk/wires/aap/article-15171019/Infrastructure-key-offers-unlock-regional-housing.html
2. NEW FM (3 October 2025). NSW building standard crackdown wraps up. https://newfm.com.au/articles/hunter-building-commission-blitz/
3. AAP  (3 October 2025). 'Pivotal': major update on $4.8b renewables project. https://aapnews.aap.com.au/news/pivotal-major-update-on-4-8b-renewables-project
4. by Kat Wong (8 October 2025). Infrastructure 'key' offers to unlock regional housing. https://thewest.com.au/politics/infrastructure-key-offers-to-unlock-regional-housing-c-20274041?utm_source=csp&utm_medium=portal&utm_campaign=Streem&token=x%2BHOv5PbUfpl7VGH3f1UzLdTa7uPl0ZNfhj3Xxf0hOJxq41pEnz7Xwuv%2BKjU3QOh9Z6IHZu0SxFja7mmbPGKBg%3D%3D
5. BTR News Australia (3 October 2025). Landcom to deliver BTR homes for essential workers. https://www.btrnews.au/landcom-to-deliver-btr-homes-for-essential-workers/
6. Global Travel Media (8 October 2025). Veriu Group Breaks Ground on Stylish Punthill Albury Hotel. https://eglobaltravelmedia.com.au/2025/10/08/veriu-group-breaks-ground-on-stylish-punthill-albury-hotel/
7. InnovationAus.com (7 October 2025). NSW, Singapore ink MoU on green economy and innovation ties. https://www.innovationaus.com/nsw-singapore-ink-mou-on-green-economy-and-innovation-ties/
8. The Fifth Estate (7 October 2025). Australia needs to seize the lead with construction AI. Are we ready yet?. https://thefifthestate.com.au/columns/spinifex/australia-needs-to-seize-the-lead-with-construction-ai-are-we-ready-yet/
9. Port Macquarie News (8 October 2025). Regional communities behind the wheel of new transport plan. https://www.portnews.com.au/story/9082546/new-integrated-transport-vision-for-hunter/
10. by Joel Ehsman (7 October 2025). Gov urged to 'walk and chew gum' on Port Kembla industrial transformation plan. https://www.ulladullatimes.com.au/story/9082920/nsw-urged-to-prioritise-port-kemblas-industrial-transformation/
11. by Jim O'Rourke (7 October 2025). The Five Ways Crows Nest: Developer seeks to add 100-room hotel to $640m ‘Five Ways’ tower. https://www.ntnews.com.au/news/nsw/the-five-ways-crows-nest-developer-seeks-to-add-100room-hotel-to-640m-five-ways-tower/news-story/f39a3cbe1a9425ac1e894b90f3a6d005?btr=f3964f9eff4a9457ab466cc4e434a89e
12. Mudgee Guardian and Gulgong Advertiser (7 October 2025). Gulgong's solar farm gets green light with critical community safeguards. https://www.mudgeeguardian.com.au/story/9083134/tallawang-solar-farm-approved-in-gulgong/
13. (7 October 2025). Major construction works underway on HumeLink project. https://esdnews.com.au/major-construction-works-underway-on-humelink-project/
14. The Daily Mail | by Australian Associated 8 October 2025, 6:01am AEDT. (8 October 2025). Next-generation solar technology inches closer to roofs. https://www.dailymail.co.uk/wires/aap/article-15171383/Next-generation-solar-technology-inches-closer-roofs.html
15. The Urban List Sydney (7 October 2025). The New Western Sydney Airport: What’s Happening At Bankstown. https://www.theurbanlist.com/sydney/a-list/western-sydney-airport-bankstown-update
16. BTR News Australia  (7 October 2025). Build to Rent national pipeline valued at over $30bn. https://www.btrnews.au/build-to-rent-national-pipeline-valued-at-over-30bn/
17. Mortgage Professional Australia (7 October 2025). NAB green lending surpasses $2 billion. https://www.mpamag.com/au/specialty/green-lending/nab-green-lending-surpasses-2-billion/552007
18. ZOOFM (7 October 2025). Tallawang Solar Farm Approved. https://zoofm.net.au/articles/tallawang-solar-farm-approved/
19. Paul Scully (7 October 2025). Land audit unlocks another 600 dwellings. https://paulscullymp.com.au/news/media-releases/land-audit-unlocks-another-600-dwellings/
20. Forbes Phoenix (7 October 2025). What Do You Think About Inland Rail?. https://www.forbesphoenix.com.au/what-do-you-think-about-inland-rail/
21. Roads & Infrastructure Australia (7 October 2025). Milestone for Snowy 2.0 TBM. https://roadsonline.com.au/milestone-for-snowy-2-0-tbm/
22. Energy News Bulletin (6 October 2025). HumeLink construction marks major milestone in NSW power overhaul. https://www.energynewsbulletin.net/energy-transition/news-analysis/4521089/humelink-construction-marks-major-milestone-nsw-power-overhaul
23. National Australia Bank (6 October 2025). NAB delivers $2 billion of new green finance to support transition. https://news.nab.com.au/news/nab-delivers--2-billion-of-new-green-finance-to-support-transiti0
24. Build Australia (6 October 2025). Deicorp begins Hyde Metropolitan tower construction. https://www.buildaustralia.com.au/projects/deicorp-begins-hyde-metropolitan-tower-construction/
25. The Urban Developer (6 October 2025). ESR Greenlit for Second Stage of Westlink Industry Park. https://www.theurbandeveloper.com/articles/esr-westlink-stage-2-approved-mamre-road
26. News.com.au (8 October 2025). 80,000 homes approved but almost none being built. https://www.news.com.au/finance/real-estate/80000-homes-approved-but-almost-none-being-built/news-story/3e54c8267d1a4894078285724e258b66?btr=f6d444f5f89672a51134de5bc033fe90
27. Download the Report: https://rwcws.com/western-sydney-residential-development-overview-/
28. null. (n.d.). Australia takes big step to more affordable clean energy with major construction underway on nation-critical HumeLink project. https://www.transgrid.com.au/media-publications/news-articles/australia-takes-big-step-to-more-affordable-clean-energy-with-major-construction-underway-on-nation-critical-humelink-project/