Melbourne suburbs set to get more high-rise buildings as part of major planning overhaul

Councils will be stripped of decision-making powers in multiple Melbourne suburbs, paving the way for new high-rise precincts based around transport hubs.

New high-rise precincts based around transport hubs are set to be established across Melbourne’s inner and middle suburbs, in the biggest planning reform in decades.

Councils will be stripped of decision-making powers in new “priority precincts”, in a desperate bid to fast-track housing developments and squeeze one million homes into established suburbs by mid-century.

Local government controls outside of the new planning zones are also likely to be curtailed in light of a damning report into council and developer bribery set to be released this week by the Independent Broad-based Anti-corruption Commission.

A source close to the government said: “Once the Sandon (IBAC probe) report is released, councils won’t be in a strong position to say they should run planning approvals.”

High rise towers will be fast-tracked in a bid to squeeze one million homes into established suburbs by mid-century.

This could result in all developments that are valued above a certain threshold being taken over by the state, which would also seek to speed up approvals.

In South Australia, for example, a government-controlled body oversees planning for Adelaide developments worth more than $10m.

New incentives for building social and affordable homes – such as increased height limits – are also being considered as part of a broader “housing statement” Premier Daniel Andrews said would be released within weeks.

Underpinning the statement will be the “priority precincts” strategy, which would allow the state to seize control in areas with good transport, health services and schools.

This would build on the government’s plan for the $34.5bn Suburban Rail Loop, where six new precincts will be overseen by the minister, allowing for more suburban high-rises.

Other existing high-rise zones in Melbourne include Arden, Sunshine, Footscray, Docklands and Fishermans Bend.

The new high-rise precincts will be based around transport hubs. Picture: David Geraghty

The government could also take over decisions in some regional centres, such as where $1bn in housing was promised after the cancellation of the 2026 Commonwealth Games.

Revenue from a new windfall tax on rezoned land in Victoria, introduced on July 1, could soar for the cash-strapped government under changes being considered, while faster approvals could also attract higher fees and charges.

Senior ministers say the plan is still being worked on but will be controversial in suburbs where communities are opposed to increased density.

But all ministers who spoke to the Herald Sun on condition of anonymity said they backed the concept that ongoing urban sprawl to Melbourne’s fringes was unsustainable.

“There needs to be more housing in inner and middle suburbs,” one said.

Massive delays within the state’s planning tribunal, VCAT, and some local government areas are being cited as a key driver for reform, along with expected massive population growth.

An artist’s impression of Arden station, which is part of the Metro Tunnel project.

One insider said the precincts strategy being discussed was being compared to Queensland’s Priority Development Areas, in which a minister can declare special zones to speed up planning, encourage economic development, and mandate affordable housing.

Earlier this month, Mr Andrews said the government was considering “lots of different policy proposals” but flagged moves to speed up housing approvals.

“We have councils taking too long to approve things,” he said.

“We have to do better at approving things faster as well. We have to increase supply.”

This year, the Department of Premier and Cabinet set up its own “precincts and land” branch focused on the use of government-owned land and unlocking it for better use.

A Land Co-ordinator General will build a database of government-owned land which is expected to become central to the government’s strategy for new higher-density precincts.

This could then be earmarked and developed into affordable housing under the government’s new housing strategy.

Rebecca Thistleton, executive director at progressive think tank McKell Institute Victoria, said underdeveloped land should be unlocked for housing.

“There is an incredible amount of government-used land that is around transport corridors – left over from transport projects, or is no longer needed by government – and it must be used to ease our housing crisis,” she said.