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New Primara research; NSW house building approvals are rising modestly, but growth is being driven by affordability rather than demand in Sydney. With Sydney prices nearly double the rest of the state, builders are increasingly shifting to regional NSW and more affordable parts of Western Sydney, where approval growth is strongest.
New analysis reveals NSW house building approvals have grown 4% in the first four months of the financial year, with 8,023 houses approved for construction, an additional 334 compared with the same period last financial year.
The growth comes as Sydney's median house price hits $1.46 million, almost double the $770,000 median across the rest of NSW, driving homebuilders to seek opportunities in Australia's most expensive property state beyond the capital.
The average approval value has climbed to $571,000, a 6.5% increase. However, this masks a dramatic affordability divide, with approval values ranging from $323,000 in Fairfield to $1.23 million in the Northern Beaches for LGAs with over 50 approvals.
Five regional NSW areas have emerged as standout growth markets as homebuilders look beyond Sydney for affordability.
- 4% Growth in NSW house building approvals in the first four months of the financial year.
- 8,023 houses approved for construction.
- 334 additional approvals compared with the same period last year.
- $1.46 million Sydney median house price.
- $770,000 median house price across the rest of NSW.
- 6.5% increase in average approval value.
The top five NSW regions for building approval growth in the first four months of the financial year:
Wingecarribee: up 125% to 90 houses
Shellharbour: up 122% to 131 houses
Bathurst: up 89% to 51 houses
Dubbo: up 88% to 94 houses
Coffs Harbour: up 75% to 70 houses
Blacktown continues to dominate NSW's building landscape, recording 725 house approvals in the first four months, a 21% increase. With an average approval value of $417,000, well below the state average of $571,000, the Western Sydney region exemplifies the flight to affordable building options within the capital, accounting for 9% of houses approved up to October 2025.
Five LGAs recorded significant declines: Queanbeyan (down 36% to 93 houses), Hornsby (down 35% to 61 houses), Mid-Coast (down 35% to 99 houses), Wollongong (down 35% to 136 houses), and Wollondilly (down 27% to 220 houses).
This trend lands at a critical intersection of affordability, lifestyle, and market dynamics. As Sydney’s housing market continues to push prices out of reach for many, the demand for more affordable building opportunities in regional NSW is growing rapidly. Builders are now prioritizing value, seeking areas where they can build without the exorbitant price tags of the capital. The question for the future will be whether these regional areas can sustain this growth while maintaining the lifestyle appeal that draws people away from Sydney. The shift signals a change in how Australians view homeownership, with location, cost, and long-term potential becoming more important than ever in shaping where and how they choose to build their futures.
