The latest Procore/Property Council sentiment survey shows NSW confidence at 128 index points, down from 129 last quarter but ahead of the national score of 123.
Property Council NSW Executive Director Anita Hugo said the data highlights a resilient industry ready to invest, despite mounting cost and policy pressures.
"Confidence has dipped only marginally, and NSW remains ahead of the national index. Firms are still looking to hire, forward work schedules are positive and capital growth expectations across key sectors are in the black – but feasibility remains an issue" Ms Hugo said.
Ms Hugo cautioned that the survey was undertaken ahead of the latest CPI data which showed a monthly jump from 3.6 to 3.8 per cent in October.
"Industry sentiment on interest rates was already showing a clear softening in expectations for rate cuts - but last month's CPI data demonstrates that persistent cost pressures on new housing are feeding directly into inflation. That could push rates higher, making feasibility even harder.
"Our research last year with Savills showed that if government wants more homes delivered faster, the most effective lever it can pull is to reduce the taxes, fees and delays over which government has control," she said.
The December 2025 survey for NSW shows:
- Confidence at 128 index points, slightly down on last quarter but above the national result.
- State and national economic growth expectations both positive.
- Strong staffing intentions and healthy forward work schedules.
- Capital growth expectations for residential, office, industrial, retail, retirement and hotels all in positive territory, with industrial and residential particularly strong.
Ms Hugo said the passage of the NSW Planning System Reforms Bill last month and the release of the NSW Government's new strategic planning framework this week were significant steps in the right direction but warned they must be matched by a renewed focus on project viability.
"The Planning System Reforms Bill and the new strategic planning framework promise a major reset that should drive faster, more consistent decisions and help clear some of the bottlenecks that have dogged the system," she said.
"Planning reform needs to be coupled with the maths on feasibility. If we want to turn sentiment into cranes on skylines and keys in doors, government must confront the stack of taxes, charges and infrastructure costs that currently make many projects unworkable," she said.
