Progress update and implementation process for Victoria’s draft targets: 2.5 million new homes by 2051

By Meg Lee and Sal Lennon

As we explained in our previous article, Premier Jacinta Allan has announced draft housing targets for local councils to achieve in each Victorian municipality by 2051. The draft targets, which will be finalised by the end of 2024, aim to address housing affordability and availability issues. Submissions on these draft targets are open until 30 August 2024.

We now outline more details about the formulation of these draft targets and their planned implementation.

Process towards final targets

Consultation by Plan Victoria on the draft targets with local government and the public is ongoing. Initial responses, at least from local government, are that the targets are high, but are in line with much of the strategic work councils have been doing. So far, only six metropolitan councils have opposed the targets.

The draft targets for each Local Government Area are being validated through a modelling process developed by the Department of Transport and Planning. The modelling is intended to propose a distribution of new homes, so that the most growth is in the ‘best places’. The modelling considers multiple factors, including environmental constraints such as susceptibility of an area to flooding or bushfires, as well as future transport improvements.

Following further modelling and consultation, the final targets will be incorporated into a new ‘Plan for Victoria’, which will replace Plan Melbourne and is due to be released by the end of the year. This document and the targets in it, to the extent possible, will need to be regularly reviewed. There will also need to be extensive monitoring mechanisms to track progression towards achieving the targets.

Commentary on realising the targets

Providing housing quantity is essential to achieving the numerical targets. However, given the magnitude of the targets, there have been suggestions that a drive to achieve quantity at all costs could compromise quality.^[1]

The demand within the housing market will also determine the success of the targets. For example, as the number of families in Victoria grows, there will be increased demand for three-bedroom housing, and particularly standalone housing.^[2]If we are to accomplish the targets using predominantly medium or high-density housing, this may not meet the demands of the market.

From a local government perspective, the housing targets cannot be looked at in isolation. It’s likely there needs to be concurrent planning for several other things: physical and community infrastructure provision, accommodating waste, public transport and providing enough open space. If the housing targets are to be realised, they will need to be accompanied by other planning and revenue-raising measures, such as rates and development contributions overlays.

Other planning mechanisms may also need to accompany the targets to ensure their success. A revision of the use of and purpose of particular zones, such as the Neighbourhood Residential Zone, could be considered. The limitation of third-party appeal rights may also be a necessary measure to assist with meeting the targets on time.

Submissions on the draft targets are open until 30 August 2024. Please get in touch if you would like assistance with making a submission.

[1] Hitting the Housing Targets – 3 perspectives (10 July 2024) VPELA seminar; Rob Burgess, Principal, Quantify Strategic Insights.
[2] Hitting the Housing Targets – 3 perspectives (10 July 2024) VPELA seminar; Rob Burgess, Principal, Quantify Strategic Insights.