A new study has opened for tenders to facilitate more homes in Newcastle as housing affordability nears "crisis point" in the city.
Newcastle council has kicked off a process to explore options for affordable housing on land it owns.
Property consultants, community housing providers and developers are being sought for the feasibility study, which will investigate models for the ownership, operation and delivery of affordable housing on both vacant land and sites with existing buildings and usage.
The move will implement council's Local Housing Strategy 2020, which sets the framework for the provision of housing across Newcastle in the next 20 years and identified an increased supply of affordable rental housing as a priority.
Lord mayor Nuatali Nelmes said rising cost of living pressures and a rapidly increasing population meant it was important to ensure Newcastle's housing mix reflected the needs and preferences of the community.
"Housing affordability in Newcastle is at or very near to crisis point, with data showing there are more than 10,000 families suffering from housing stress across the city," Cr Nelmes said.
The lord mayor said the successful tender also must identify how multi-purpose community spaces could be incorporated into designs to deliver broader benefits.
It comes after construction kicked off on a $3.48 million redevelopment of a social housing complex at Waratah West. Two homes will be transformed into 10 units for up to 16 residents.
The Landa Parade site is one of six projects in a $17 million investment to deliver 51 dwellings in Newcastle in the next two years and comes after the announcement of an agreement between the NSW government and council to improve social and affordable housing.
"We're working closely with council as they help us identify key areas which require social and affordable housing as a priority, such as Waratah West," NSW Land and Housing Corporation Acting Chief Executive Deborah Brill said.
But a new report has identified that much more social housing investment is needed to make meaningful inroads on the long wait list for a dwelling.
The Future Impact report commissioned by the St Vincent de Paul Society and developed by the Centre for Social Impact at the University of New South Wales showed that the state's current trajectory of building social housing will reduce the wait list by about 10 per cent by 2039.
The Society has long called for the government to commit to 5,000 new social housing dwellings every year for a decade. This could reduce the wait list by more than 73 per cent by 2031, the report said.
Forecasts shows the Newcastle Local Government Area's population is set to grow by 41,150 residents to 202,050 by 2041, which will stimulate demand for almost 20,000 new dwellings.
Research has also shown that one in three Newcastle households have an annual income of less than $48,000 and a further 33 per cent suffer housing stress by spending more than 30 per cent of their income on housing.
