Victoria needs millions of new homes. Here’s where they will be built

Councils in Melbourne’s outer north and north-west will be told to find room for hundreds of thousands of new homes over the next three decades as the government releases fresh targets to boost the state’s housing stock by more than 2 million.

On Sunday, Premier Jacinta Allan and Planning Minister Sonya Kilkenny will unveil the draft targets for each council area in Victoria.

The number of homes in the City of Melbourne will more than double, and there will be dramatic increases in Maribyrnong, which takes in Footscray, Seddon and Yarraville, where the council will be asked to find space for 49,000 new homes by 2051 – a 114 per cent jump from current levels.

The state government will also propose that the Whitehorse Council, which takes in Box Hill, Mitcham, Mont Albert, Vermont and Surrey Hills, accommodate 79,000 new homes, up from 74,200 dwellings listed in the area in 2023.

“To give industry the confidence they need to get on and build, we need government and all councils working towards the same goal: more homes for Victorians – in the right places,” Allan said.

While the government insists more homes are needed in established suburbs – close to jobs, transport, education, and services – the housing targets will still see fringe suburbs swell.Credit: Jason South

While some advocates have argued that the state government must boost the level of medium-density housing in the city’s established inner ring, the government’s new targets will see numbers in outer Melbourne council areas like Melton and Mitchell swell by the largest percentage over the next three decades.

Beveridge and Wallan in the Mitchell Shire will shoulder the largest percentage increase, with the number of dwellings jumping from 21,800 to 89,800 by 2051 – up more than 300 per cent on current housing stock.

Under the draft targets, the number of houses in the Moorabool Shire, centred on Bacchus Marsh, and the neighbouring City of Melton – already Australia’s fastest-growing local government area – will also be dramatically boosted.

The targets will also deliver more homes in the regional city of Geelong with the government pushing for an extra 139,800 properties by 2051 – in addition to the 127,300 homes in the LGA in 2023.

The housing targets are part of Labor’s ambitious plan to build 800,000 homes over the next 10 years in a policy move described by then-premier Daniel Andrews as “the most comprehensive shake-up of one of the most important policy areas in decades”.

But recent data from the Australian Bureau of Statistic has revealed Victorian is on track to approve fewer than 45,000 homes for construction in 2024, down from 51,000 last year and well short of the Allan government’s target of 80,000 homes a year for the next decade.

As part of its housing plan, the state government promised to build higher-density housing around six Suburban Rail Loop stations between Cheltenham and Box Hill in Melbourne’s east.

While the targets will result in huge growth in greenfield estates on the urban fringe, the state government will also mandate that the Boroondara LGA – which includes Balwyn, Camberwell, Hawthorn and Kew – accommodate 67,000 new homes by 2051.

That would represent a 90 per cent increase in new dwelling approvals against its recent average.

The Kingston LGA, which takes in Cheltenham, Clayton, Mentone and Moorabbin, will be expected to boost its housing stock by 59,000 new homes – an 85 per cent increase – which the government said was “contributing to a pattern of growth along the Suburban Rail Loop corridor”.

The state government will kick off consultation with councils on Monday. The final housing targets expected to be in planning schemes by the end of the year.

The government’s draft targets were provided to The Sunday Age on an embargoed basis, with the condition that no third-party comment be sought before the announcement.

While possible penalties for councils that don’t meet targets are not expected to be covered in Sunday’s announcement, The Age previously revealed the Allan government would consider stripping councils of their planning powers if they failed to achieve the finalised targets.

“We want to work in partnership with councils to build more homes in the areas where people want to live – close to the people they love and the things they love to do,” Planning Minister Sonya Kilkenny said.

The state government has been critical of so-called NIMBY councils for purportedly stymieing new developments, and has urged them to unlock space for more homes by proposing changes to local planning rules.

But urban design experts and industry bodies have raised concerns about Victoria’s bold target, arguing labour and material shortages and weak economic conditions may limit Victoria’s bid to build 800,000 homes in a decade.

Last month The Age revealed Victorian builders had shelved more flats and townhouses than they started – despite being given the green light by local councils – suggesting nervous developers were also contributing to Victoria’s housing slowdown.

While most Melbourne-based councils will be asked to boost the number of dwellings by more than 80 per cent, the green wedge Shire of Nillumbik, which takes in Eltham and Diamond Creek, and the City of Frankston will be asked to expand their housing stock by only 50 and 60 per cent respectively.

Smaller regional council areas in the state’s west, such as Buloke, West Wimmera and Hindmarsh, will be required to boost housing stocks by less than 10 per cent.

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