After what seemed to be years of relative policy inaction, the Victorian Government published the Housing Statement in September 2024. It was called Victoria’s Housing Statement – The decade ahead 2024 – 2034. It prefaced a range of initiatives that were to come, from making good decisions faster, later refined to making big decisions faster, increasing housing choice in activity centres, issuing permits faster, providing for the comeback of the granny flat or small second dwellings and somewhat optimistically providing cheaper housing closer to where people work. It also promised more social housing and foreshadowed a long term housing strategy to guide how the state grows and develops in coming decades.

As is the case with many announcements by governments, to understand what was really proposed one had to read through the spin.

Since then and particularly in the last 4 months or so there have been a swathe of announcements released almost daily about the reform of housing policy. I recall waiting for the daily dose of “todays episode” of housing policy.

Most of the big policy announcements are now out so, we can do a bit of a binge to catch up but like a great Netflix series we are still waiting for the final episode likely due in a few weeks time. So what’s happened so far?

The first observation is that despite the promise of a long term housing strategy to guide how the state grows, Plan for Victoria has still not dropped. It is a little curious that most of the big policy announcements are made before the overall plan is released. Whether Plan for Victoria will contain any final big bang, like a good fireworks display, we have to wait and see. Perhaps it will be just a bookend to the Housing Statement. Keep an eye out for its release potentially towards the end of this year.

What would an announcement be without numbers? Numbers were literally flying around the place. We had 60,000 being the number of new dwellings proposed for an initial 10 activity centres, then we had 80,000 being the number of new dwellings that the State was aiming for annually, and then the big bang target of 2.45 million new dwellings by about 2053. That target was followed by municipal housing targets that seemed to get many councils in a spin wondering how on earth they were supposed to provide for so many homes in their local area.

As noted earlier, looking through the announcements, housing targets quickly gave way to housing “capacity” which is a completely different thing. Freeing up capacity in the suburbs and in activity centres foreshadowed a review of all planning zones and overlays to ensure that it is easier to subdivide land, build a second dwelling and free-up the backyards of large suburban areas.

With so much early emphasis being on the established suburbs and particularly the middle suburbs with the 70 – 30 split of all new housing in established areas rather than in growth areas the focus then quickly turned to a plan for more outer suburban growth. So, a policy for a 10 year pipeline of greenfield development was then released identifying an extended work program for a restructured VPA.

The 10 year greenfield plan is not really new. It is essentially a bringing forward of the annual announcements traditionally made by VPA setting out its annual work program. Its just that now we know its 10 year work program split over three horizons. But, the VPA is going to have a fair bit on its plate. 27 new growth plans or PSPs are proposed. However the thing to note is that a number of these were already in the pipeline or sitting on the Minister’s desk for some time. For example Beveridge North West hearings took place over 2 years ago with no outcome yet; Officer South is all over bar the shouting and Wallan South has been on the books and in early planning for some time.

As always, the key to unlocking some of these areas will be infrastructure. While Officer South Employment PSP is one of the key growth plans announced, the Committee hearings for that growth plan made it clear that development would not be permitted to proceed until key state infrastructure was first provided or at least funded. This signals a new shift to potentially mandatory limitations on greenfield development to stop forcing the Victorian Budget to have to bring forward costly transport infrastructure before it is actually affordable.

The Activity Centres Program which saw draft activity centre plans published for the first 10 Activity Centres with what can be described as relatively radical intent for activity centres were then extended to a further 25 tram and train based activity centres and a further 25 soon after that. In the background the Department is currently working on a suite of new planning controls for the core of activity centres and a walkable catchment around the core to significantly increase the density of housing in those areas. It seems that this is all happening as we speak with final announcements likely to be made by the end of the year. Stay tuned too for a further reform around development contributions. So while delivering cheaper housing to where people work is a key initiative, new infrastructure levies are likely to accompany much of that new housing. The weirdest part of this policy announcement is that it had much of the media quoting people who were asking about these “new” activity centres when in actual fact activity centres policy and the nomenclature as been with us for over a decade; w call them activity centres, they call them shopping centres.

In another key initiative the Suburban Rail Loop Precincts, being the “bigger brother” of the first 10 activity centre siblings is currently undertaking precinct planning for the six SRL station precincts from Box Hill in the north to Cheltenham in the south. Unlike the Activity Centres Program the SRL seems to be taking its time with the planning for those six precincts with the process timed to culminate in the approval of controls in around early 2026. At the moment there are no clear indications of the numbers being planned for each of these centres but one can expect that built form controls in these centres will be “on steroids” to ensure maximum uplift in values for subsequent value capture by the windfall gains tax.

Deemed to comply provisions were initially flagged in the Housing Statement and were thought to apply to smaller housing developments but the initial suite of 10 Activity Centres Plans made it clear that Deemed to Comply provisions would apply to large scale podium and tower type development putting complaint about building heights or setbacks potentially out of reach of decision makers.

Development Facilitation has played a key role over the last few years. Born out of Covid under a different banner at that time, it has transformed into a substantial internal departmental unit that is responsible for driving through any application that qualifies under the admittance criteria. Development facilitation was provided with two key new planning provisions at clause 53.22 and 53.23 which provided alternative pathways to seeking approval for significant economic development proposals and significant residential development with affordable housing. A key aspect of these two provisions is that the Minister is made responsible authority for any permit application that falls within the pathway. There are criterial for what qualifies based on the value of development with different thresholds for metropolitan and regional areas.

Its hard to see how any level of government can afford the infrastructure and open space that will be necessary as an adjunct to the substantial new housing numbers that are planned for activity centres. So expect to see innovative programs and schemes which find other ways of unlocking infrastructure provision. A key new provision is likely to be value capture and uplift schemes. This was first tried in Fishermans Bend with the Affordable Housing Uplift Scheme that enables development to apply for permission for built form above base building envelopes and mandatory floor area ratios if affordable housing is delivered at a ratio of approximately 1:8. The value capture scheme is currently for expansion as part of an Open Space Uplift scheme which allows development to increase housing density again above base building envelopes and floor area ratios if public open space is provided in return. Look out for similar but simplified mechanisms going forward potentially dealing with other public benefits. The jury is still out on how effective these will be though.

So there is lots happening and more to come. Stay glued and keep watching this space.