The building boom needed to fix the current housing crisis would be similar to the scale of construction required at the end of World War II, the NSW planning minister says.
The Minns Labor government has been spruiking major proposed changes to planning rules despite several local councils pushing back against the changes.
In December, the government announced a major planning overhaul centred on 40 transport hubs that could cater to 210,000 new dwellings across greater Sydney, Newcastle and Wollongong.
The proposed precincts - including many in heritage-protected areas - would be subject to increased density.
Annual building completions for NSW sit at about 48,000 homes, well short of the 75,000 annual average that the state has committed to for the next five years.
Planning Minister Paul Scully told a gathering of property industry figures the state had previously stepped up to tackle an even bigger housing challenge at the end of World War II, when returning veterans and migrants needed somewhere to live.
"We need a similar housing construction boom in NSW right now," he said.
"Sydney ranks 48th amongst developed economies ... but ranks 859th in the world in density, which places it among the least densely populated cities in the world.
"And we have less diversity of housing typologies in Sydney today than what we had 100 years ago."
Multiple Sydney councils say the proposed zoning changes have been foisted on their areas with little detail or consultation.
But Mr Scully said the plans to build more houses around existing infrastructure and within 400m of train stations were flexible.
"While the published maps start by drawing a circle with a 400m radius around each of these sites, this is the starting point for planning consideration and not something fixed in stone," he said.
"If part of that radius is impacted by flood, then the area would be excluded and the boundaries adjusted to reach the required density in that local government area."
With proposed planning changes expected to see an influx of development applications submitted to councils, the state government is also looking to the assistance of artificial intelligence.
Mr Scully announced a $5.6 million investment in AI technology to help reduce manual workloads for councils and to streamline the pre-lodgement phase.
The government expected AI use would cut development application assessment times and improve efficiency in the planning system.
But ultimately the success of housing reforms would take hard work and required communities to be open to change, the minister added.
"Cities are not museums, they are home to millions of people and every day they are changing," he said.
"So we need to ask ourselves: is our city keeping pace with the scale of change that has happened and is it providing good homes for everyone?
"I think a reasonable assessment would say right now the answer is no."
