Luxury housing development replaces affordable units in Sydney's Bondi and inner suburbs
In Sydney's Bondi Beach and surrounding inner city and lower north shore suburbs, several older affordable housing blocks are being replaced by fewer, luxury apartments and townhouses, raising concerns about the erosion of housing diversity.
The Mayfair building at 58 Campbell Parade, Bondi Beach, previously a 16-unit art deco block, has been gutted and converted into seven luxury apartments, with the top-floor unit marketed at $22–$24 million.
Similar trends are evident elsewhere: for instance, 13-17 Ithaca Road in Elizabeth Bay was reduced from 32 to 9 units; 122 Hewlett Street in Bondi replaced 22 affordable units with nine luxury townhouses; 262 Campbell Parade was transformed into two luxury townhouses; and 22 Hewlett Street in Bronte was redeveloped into nine luxury townhouses.
Critics warn that these developments create enclaves for the super-wealthy, making these areas unaffordable for most residents.
Local council policies aiming to limit dwelling loss are facing challenges. Although the City of Sydney has a policy to restrict reductions in dwellings to 15%, this was undermined by state intervention allowing the Chimes development to proceed despite the policy. Waverley Council briefly considered a no-net-dwelling-loss policy but eventually dropped it. In contrast, the Bondi Junction masterplan seeks to boost housing supply and maintain diversity. Meanwhile, the state government continues to support no-net-dwelling-loss approaches.
Developers are increasingly using the NSW affordable-housing incentive, which grants up to 30% extra floor space for including affordable units rented at 20% below market rates for 15 years. Critics argue this incentive only delays addressing true housing affordability issues.
In the north shore area of Kurraba Point, Neutral Bay, 47 small units were consolidated into 24 luxury apartments, including a $40 million penthouse. Additionally, Paddington’s Oxford Street block is set to become an eight-storey development with approximately 40 units, some of which will be affordable, though this raises ongoing concerns about housing affordability in the area.
