Sydney's Affordable Housing Crisis: Are New Laws Making Things Worse? (2026)

The plan to build more affordable housing in Sydney has a hidden catch, and tenants are feeling the impact. Erina Delinicolas, a resident of Marrickville, found out about the potential demolition of her apartment through a friend's casual inquiry, rather than an official notice. Her art deco building, located near Marrickville station, could be replaced with a nine-storey block of flats, raising concerns about the neighborhood's affordability. The New South Wales 'in-fill' bonus for housing near transport incentivizes developers to provide low-cost rental units, but critics argue that this scheme may inadvertently lead to the loss of existing affordable housing. The redevelopment of The Chimes building in Potts Point, which will see luxury apartments replace modest units, is a prime example of this controversy. The Warren Road development, which Delinicolas is concerned about, would see 17 low-cost rental units demolished and replaced with 43 mostly two and three-bedroom units, with eight designated as affordable. Residents, including students, essential workers, and seniors, are worried about the impact on their budget, as the median rent for a one-bedroom unit in Marrickville is already $500 to $720 a week. The development's project manager declined to comment. While the scheme aims to increase housing supply, some argue that it may not adequately protect existing affordable units. The debate continues as residents and advocates raise concerns about the potential loss of older, low-rental dwellings under the council's broader development plans. The Inner West mayor clarifies that the Warren Road DA is separate from the Our Fairer Future plan, which requires a 20% contribution for additional floor space beyond new height limits. However, the mayor also acknowledges the impact of 'mindless opposition to new homes' on young people's ability to afford living in the inner west. The controversy highlights the complex balance between incentivizing developers to build affordable housing and preserving existing low-cost rental units.

Sydney's Affordable Housing Crisis: Are New Laws Making Things Worse? (2026)

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