VAST tracts of housing estates could be built in Sydney outside areas now planned for population growth after the Planning Minister, Brad Hazzard, supported a blueprint to accelerate housing development.

Sydney’s historically low home-building rates have led to a chronic undersupply of housing in the city and contributed to some of the highest property prices and rents in the world.

Analysis by the Urban Development Institute of Australia has sought to identify land where 90,000 homes could be built quickly, mainly in areas not now designated for housing.

Much of the land identified in the report, Building Blocks, written by the development group Cardno, an institute member, lies entirely outside the north-west and south-west growth centres earmarked by the previous Labor government for new housing. The new housing sites include a tract to the west of Campbelltown.

Some sites are inside these two growth centres but in areas that will not be developed for many years.

Mr Hazzard said the report was worth “10 out of 10” for stimulating debate. He agreed with the institute’s argument that there had been a failure in meeting Sydney’s housing requirements and a new strategy was needed. “There’s no doubt putting lines on maps and calling them growth centres … has to some degree been a flop,” he said.

“It failed to take into account local issues like lack of infrastructure, fragmented ownership of land and some lots having an almost nil likelihood of being converted from agricultural to residential land and a general failure to really recognise the local needs of developers.” The institute has briefed Mr Hazzard and several other ministers including the Premier, Barry O’Farrell, on its research to persuade them to partly fund $900 million of infrastructure in three areas where the 90,000 extra dwellings could built over five years.

While sympathetic to the need to develop outside growth centres, Mr Hazzard said funding the infrastructure would be “an almighty challenge in the state’s economic circumstances”.

To find land attractive to developers, Cardno conducted an audit of holdings bigger than 10 hectares, within a kilometre of main roads or rail lines, within a kilometre of major power lines

and trunk water infrastructure and within five kilometres of an “existing urban fringe”.

It then costed the required infrastructure and the likely number of housing sites that could be delivered.

It found land in and around the north-west growth centre could provide 31,000 lots if $335 million was spent on infrastructure; 33,000 lots could come from the south-west at a cost of $480 million, while the area around Appin and Wilton could provide 13,000 lots immediately if $85 million was spent.

The institute’s chief executive, Stephen Albin, said that while there was “long-term merit” in planning growth centres, a policy was needed to kick-start the development industry, with new-home rates now at a 50-year low.

“You can’t just plan and pray. You have to be commercial and work out what are the real drivers of the economy … and resolve the commercial issues,” he said.

The research, to be released tomorrow, shows some of the land identified for development is owned by institute members but Mr Albin said the project was an attempt to revive development, not serve his members’ interests.

Mr Hazzard said: “It could be viewed as a cynical developer exercise … but I’d like to think the community is a bit more mature and could see mutual interest of a community who would like to buy homes at a reasonable price and developers who can deliver them at a reasonable price.”