Where Melbourne's new homes are going to be built to meet housing targets

Summary:

• Victoria sets housing targets to accommodate 2.24 million new homes by 2051
• 70 per cent of Melbourne’s growth directed to established areas, with 30 per cent in outer suburbs
• New planning reforms aim to fast-track approvals and cut delays by 60 per cent
• Property Council supports targets but calls for tax incentives to boost investment

The Victorian government has finalised housing targets for councils across the state, outlining where and how many new homes will be built to accommodate an expected 2.24 million additional homes by 2051.

The targets prioritise development in established areas close to jobs, transport, and services, reversing previous trends that saw expansion largely concentrated in outer suburbs.

Under the new plan, 70 per cent of Melbourne’s growth is directed towards established areas, with the remaining 30 per cent allocated to outer suburbs. Regional Victoria is set to account for 25 per cent of all new homes.

The government has ranked council areas based on projected housing growth, with Greater Melbourne councils seeing the most significant increases.

Greater Melbourne’s housing targets are led by the City of Melbourne, expected to grow from 110,100 homes to 229,600 by 2051, an increase of 119,500 homes.

Melton follows closely, with an addition of 109,000 homes, bringing its total to 178,300 by 2051.

Wyndham is set to expand from 109,300 to 208,300 homes, while the City of Casey is projected to add 87,000 homes, taking its total to 218,000.

Other growth areas in Metropolitan Melbourne include:

• Whittlesea: 88,100 to 160,100 (+72,000)
• Mitchell Shire Council: 9,700 to 75,700 (+66,000)
• Cardinia: 46,400 to 76,400 (+30,000)

In regional Victoria, Greater Geelong is set to accommodate 128,600 new homes, followed by Ballarat with 46,900 and Greater Bendigo with 37,000.

On the lower end of the spectrum, some councils saw reductions from initial projections, with Nillumbik’s target cut from 12,000 to 6,500 additional homes.

Premier Jacinta Allan stated that the revised targets are designed to distribute growth more evenly and ensure affordability across the state.

Councils will be required to demonstrate how they will meet these targets or risk government intervention in planning decisions.

Planning Reforms to Support Growth

To support the delivery of housing targets, the government has introduced a Townhouse and Low-Rise Code to fast-track approvals for homes up to three levels.

If a project meets the new code, which sets out criteria such as setbacks, tree coverage, and minimum room sizes, it will be “deemed to comply” and fast-tracked through the system, avoiding lengthy planning delays and third-party appeals at VCAT.

The government expects the new code to significantly reduce planning permit assessment times, cutting delays by at least 60 per cent.

Minister for Planning Sonya Kilkenny said the reforms aim to streamline approvals for well-designed, sustainable homes that integrate into existing neighbourhoods.

A broader overhaul of the state’s planning system is also underway, with the government pledging to rewrite the Planning and Environment Act 1987 to simplify the process for new housing developments.

Premier Jacinta Allan reinforced the government’s commitment to tackling the housing crisis, stating, “Homes don’t get built when they’re lost in the snakes and ladders of the planning system – so we’re fixing it.”

With Victoria’s housing targets now locked in and planning reforms set to accelerate approvals, the Property Council of Victoria has welcomed the new targets but emphasised the need for tax incentives to encourage investment and ensure housing targets can be met.