From Bankstown to Lakemba: How New Planning Rules Are Creating Real Options For South West Sydney Locals

Across South West Sydney, the map is shifting.

New NSW planning rules around transport hubs and medium-density housing are changing what can be built near key train and metro stations. Bankstown, parts of the Sydenham–Bankstown corridor, and several nearby centres are all in focus.

You’ll hear terms like “TOD precincts”, “low and mid-rise housing” and “shop-top” development. Underneath the jargon is a simple idea: put more homes and mixed-use buildings near stations, jobs, and services, rather than pushing growth further and further out.

From a finance perspective, the key issue is how these planning shifts translate into real opportunities – or risks – for local property owners.

So let’s bring it down to street level and look at what this could mean for you if you live in, invest in, or run a business in Bankstown and the broader south west corridor.

What’s Actually Changing In South West Sydney?

Without getting lost in policy detail, here’s the practical picture.

1. More homes near Bankstown Station

Bankstown has been identified as a priority for additional housing and mixed-use development around the station and metro. Over time, this can mean:

• Taller residential and mixed-use buildings closer to the centre

• More shop-top housing (commercial at street level, units above)

• A stronger focus on Bankstown as a hub for jobs, health, education and services

2. Renewal along the Sydenham–Bankstown line

Stations such as Lakemba, Punchbowl, Wiley Park, Belmore, and Canterbury are also part of the long-term renewal story. As transport upgrades roll through, planning work tends to follow with:

• More people living close to stations

• Older stock (houses, older walk-ups, tired shops) becoming a candidate for renewal

3. More medium-density options in surrounding suburbs

In parts of suburbs like Yagoona, Greenacre, Revesby, Condell Park and beyond, policy is moving toward more:

• Duplexes and dual occupancies

• Townhouses and terraces

• Smaller “walk-up” unit blocks

The planning layer is important. But the real conversation we’re having with clients is about what they can do with their property and borrowing power in this new environment.

Key Projects Powering Bankstown’s Next Chapter

In addition to the planning changes, a few major projects are reshaping how people live, work, and travel in and around Bankstown.

1. Sydney Metro Southwest: Bankstown as a True Interchange

Bankstown is becoming one of South West Sydney’s most important public transport hubs.

The Sydney Metro City & Southwest project is converting the old T3 line between Sydenham and Bankstown into a high-frequency metro, with modern, fully accessible stations and trains running every few minutes during peak periods.

For locals, this means

• Faster, more reliable trips into the CBD and across the metro network

• A genuine “turn up and go” service that makes car-free or car-light living more realistic

• Stronger long-term demand for homes, shops and services within walking distance of the station

• Being close to a genuine metro station usually makes it easier to attract tenants, retain tenants, and increase value over time, particularly for quality apartments and mixed-use buildings.

2. Bankstown Train Station Upgrade

Bankstown’s existing train station is also getting a major lift so it can function as a proper gateway between Sydney Trains and the new metro line.

Upgrades include:

• New metro platforms with safety screen doors

• Improved accessibility and concourse areas

• A new plaza space connecting the north and south sides of the centre, with room for retail and dining

In property terms, a better station and public plaza usually mean:

• Improved street appeal and pedestrian traffic around the station

• A stronger case for shop-top housing and mixed-use projects

• This usually draws in more tenants, both residential and commercial.

For owners and investors, upgrades like this can make a basic buy-and-hold near the station more attractive or open the door to freshening up an older building or doing a small redevelopment.

3. New Bankstown Hospital and Health Precinct

On the health side, the new Bankstown Hospital project and ongoing use of the existing Bankstown-Lidcombe Hospital site will effectively create a larger health and education precinct in Bankstown.

Why this matters for property and finance:

• Health precincts support stable employment and a steady flow of staff, patients and visitors

• This underpins demand for rental housing, short-stay accommodation and nearby services

• Over time, parts of the area can shift from being seen mainly as “residential” to being a jobs and services hub as well

For investors, including SMSF and faith-conscious clients, well-selected property near major health infrastructure can support long-term, income-focused strategies.

4. Property Opportunities In South West Sydney

When you combine:

• A new metro station and upgraded interchange

• A major hospital and health precinct

• State-backed planning which encourages more homes around stations and centres

…you get a very different picture of Bankstown and its surrounds over the next 10–20 years.

Some of the property opportunities clients are exploring with us include:

• Apartments near stations Targeting well-located units within walking distance of metro and train stations in Bankstown and nearby suburbs.

• Mixed-use and shop-top housing Looking at older single-storey shops near the centre as future mixed-use projects, combining ground-floor retail with residential above.

• Medium-density infill Duplexes, townhouses and small unit blocks on suitably zoned sites in suburbs like Yagoona, Greenacre, Condell Park and Revesby.

• Strategic landholdings Owners of properties near the metro, hospital, or within key planning areas are exploring whether to hold, improve, redevelop, or partner with a small developer.

This is where the finance strategy becomes just as important as the planning rules. The right structure – whether a construction loan, mixed-use facility, SMSF lending or a low-doc solution for experienced operators – often determines whether an opportunity stays on paper or becomes a real project.

Concrete Options for Local Owners and Investors

Here are some real-life situations we see in South West Sydney and the types of financing paths people often explore.

1. Owner-occupier with an older house near a station

Think of a typical block in Bankstown, Lakemba, Punchbowl or Wiley Park: older home, decent land size, close to the train line.

In these cases, owners are often weighing up whether to:

• Knock down and build a duplex

• Live in one side and rent the other

• Keep space for extended family

• Or simply improve the existing home and keep future redevelopment as a “one day” option.

Finance usually centres on releasing equity from the current property, funding design and approvals, then using a construction loan that’s drawn down in stages. The key questions are: What does council actually allow here? What will it cost? And does the end value and rental income justify the move?

2. Small business owner with a shop or warehouse

Here we’re talking about people who own a shop, office or small warehouse in or near a local centre.

Some are looking to add a level of apartments above their shops. Others are thinking longer term about a fresh mixed-use building to replace an older, single-level one.

Many just want to tidy up their lending and be ready if an opportunity arises.

On the finance side, the conversation is usually about:

• Whether a commercial or residential-style loan suits the property

• How lenders view a mix of retail and residential income

• Whether existing equity can be used to fund early design and DA costs

Mixed-use sits in a grey area for lenders, so cash flow, tenant strength, and overall project risk become important.

3. SMSF investors

For SMSF investors, this is usually about long-term planning rather than quick wins.

Most are focused on building a steady retirement income, already have an SMSF, or are considering setting one up.

They might be looking at:

• Units or mixed-use properties close to transport and services  

• Small projects with family or trusted partners, where one or more finished dwellings are held for the long term  

When we sit down with SMSF clients, we often talk through:

• SMSF lending rules and limits  (link to SMSF blog)

• How rent and super contributions can support the loan over time  

• How much borrowing the fund can realistically take on without putting retirement plans under pressure  

4. Small developers and builders already active in the area

These clients usually know the suburbs and zoning well. They are looking at corner sites, duplex and townhouse streets, or small unit and mixed-use blocks close to centres.

They’re usually aiming for a model they can reuse, such as a townhouse layout that suits several blocks or a small-unit design that fits likely planning controls.

Funding discussions tend to focus on:

• Development finance for smaller projects

• Pre-sale requirements

• Low-doc or alt-doc options where the track record is strong but the paperwork doesn’t fit neatly into a box.

• How to structure multiple projects so equity and cash flow aren’t stretched too thin

Part of our job is to help them grow without taking on so many sites that the numbers stop working.

The Risks And Realities

Planning changes create possibilities, but they also add complexity.

Some key realities to keep in mind:

• Not every property near a station will be up-zoned or financially viable to redevelop

• Councils, the State Government and communities are still working through how some of these policies land on the ground

• Construction and finance markets move faster than planning documents

This is why it’s important to look at your specific block, borrowing position and time horizon, rather than just the headline that “Bankstown is changing.”

How Citywide LPI Supports South West Sydney – and Beyond

Citywide LPI Bankstown is based in South West Sydney and very much part of the local community, but we also help clients across wider Sydney and interstate.

We work with:

• Homeowners looking at duplexes, townhouses or rebuilds

• Small business owners thinking about shop-top or mixed-use options

• SMSF and faith-conscious investors planning long-term strategies

• Builders and small developers needing development or low-doc finance

• People who need to get their credit profile into shape before applying

We don’t expect you to fit neatly into a box. Most clients fall into more than one of these categories.

Our role is to:

• Understand your properties, income and existing loans

• Listen to what you’re trying to achieve over the next few years

• Explain, in plain language, what your finance options look like from here

If you’re not sure what these planning or lending changes mean for your address or your next project, this is exactly the kind of conversation we’re here for. 

You bring the details. 

We help you make sense of the numbers and the pathways.