OUTCOME 2

Melbourne provides housing choice in locations close to jobs and services

Melbourne will need 1.6 million new homes over the next 35 years.

Issues that need to be addressed include: housing affordability, the types of housing available to cater for different household needs and lifestyles, and the provision of medium- and higher‑density housing close to jobs and services. Another pressing issue is the growing number of homeless people and households waiting for public housing.

Melbourne’s Plan

Direction 2.1

Manage the supply of new housing in the right locations to meet population growth and create a sustainable city

The social, economic and environmental benefits of creating a more compact, sustainable city are profound. Some of the benefits of compact, higher-density neighbourhoods are as follows:

Social

It encourages positive social interaction and diversity, improves the viability of (and access to) community services and enables more (and better integrated) housing.

Economic

It enhances the economic viability of development, improves the economic viability of infrastructure delivery and utilises existing infrastructure.

Transport

It creates sustainable demand for more transport options—including public transport, walking and cycling—and can reduce overall travel time.

Environmental

It creates opportunities for efficient use of resources and materials, creates less pollution through the promotion of sustainable transport, preserves and helps fund the maintenance of public open space, creates new public open space, reduces overall demand for development land, and avoids expanding suburbs without supporting services.

Strategies need to be put in place that articulate clear goals and objectives for housing and:
• outline the needs of different household types
• provide a greater understanding of the range of housing needed
• provide a stronger understanding of opportunities and constraints
• identify preferred housing outcomes
• help clarify and communicate housing required across metropolitan Melbourne and its metropolitan regions
• address housing diversity, design, quality and energy efficiency
• seek to locate at least 65 per cent of new housing in established areas of Melbourne and no more than 35 per cent in growth areas in line with current levels of development and Victoria in Future projections.

Policy 2.1.1

Maintain a permanent urban growth boundary around Melbourne to create a more consolidated, sustainable city

Policy 2.1.2

Facilitate an increased percentage of new housing in established areas to create a city of 20-minute neighbourhoods close to existing services, jobs and public transport

Policy 2.1.3

Plan for and define expected housing needs across Melbourne’s regions

Policy 2.1.4

Provide certainty about the scale of growth in the suburbs

Direction 2.2

Deliver more housing closer to jobs and public transport

Locating medium- and higher-density development near services, jobs and public transport supports the objectives of consolidation and housing choice. For this direction to be achieved, the standards of higher-density housing need to be raised. There are significant opportunities for housing development in and around the central city. There are also opportunities for more medium- and higher-density development in middle suburbs close to jobs and services including:
• urban renewal precincts
• areas identified for residential growth
• areas identified for greyfield renewal
• areas designated as national employment and innovation clusters
• metropolitan activity centres and major activity centres
• neighbourhood activity centres—especially if they have good public transport connections
• areas near existing and proposed railway stations that can support transit-oriented development. Encouraging mixed-use developments and greater housing diversity and density near employment and transport will create opportunity and choice for medium- and low-income households.

Policy 2.2.1

Facilitate well-designed, high-density residential developments that support a vibrant public realm in Melbourne’s central city

Policy 2.2.2

Direct new housing and mixed-use development to urban renewal precincts and sites across Melbourne

Policy 2.2.3

Support new housing in activity centres and other places that offer good access to jobs, services and public transport

Policy 2.2.4

Provide support and guidance for greyfield areas to deliver more housing choice and diversity

Policy 2.2.5

Require development in growth areas to be sequenced and staged to better link infrastructure delivery to land release

Direction 2.3

Increase the supply of social and affordable housing

The planning system alone cannot address all of the issues related to the provision of social and affordable housing. A range of programs and measures across all levels of government are required, but it is important that the planning system makes it easier—rather than harder—to deliver social and affordable housing.

In recent years, housing prices have risen faster than incomes, making home ownership increasingly unattainable for many citizens. As a result, many households may remain in the private rental market indefinitely unless they are prepared to buy in locations with poorer access to services and jobs.

The most severe and chronic housing affordability problems are experienced by lower-income households in the private rental market, particularly those reliant on statutory incomes such as Centrelink. In addition, levels of homelessness have increased in Victoria, with more than
22,000 people recorded as homeless on Census night in 2011.

For Melbourne to remain liveable for all its citizens, the supply of social and affordable housing needs to be increased. A range of housing types need to be developed within suburbs across Melbourne—not just in outer areas—to improve local affordability for homeowners and renters.

Policy 2.3.1P

Utilise government land to deliver additional social housing

Policy 2.3.2

Streamline decision-making processes for social housing proposals

Policy 2.3.3

Strengthen the role of planning in facilitating and delivering the supply of social and affordable housing

Policy 2.3.4

Create ways to capture and share value uplift from rezonings

Direction 2.4

Facilitate decision-making processes for housing in the right locations

Many sites identified for future housing face lengthy decision-making processes. This can make it time consuming to develop new housing, driving up housing costs.

Many sites across Melbourne have a legacy of environmental contamination as a result of the city’s industrial and manufacturing heritage. For some sites, the cost of remediation may limit re-use options. Developments allowing more than a single dwelling can also be subject to lengthy assessment processes and appeals even if they are in areas where change is envisaged. Contested applications generally arise where performance-based requirements exist instead of clearer, more
prescriptive requirements.

The uncertainty in the system needs to be reduced, particularly for development in areas defined for change and housing growth.

Policy 2.4.1

Support streamlined approval processes in defined locations

Policy 2.4.2

Facilitate the remediation of contaminated land, particularly on sites in developed areas of Melbourne with potential for residential development

Direction 2.5

Provide greater choice and diversity of housing

Housing diversity relates to the size, cost, number of bedrooms, character and age of dwellings. It also extends to other types of housing, such as low-cost rental aged care, supported accommodation for people with disability, rooming houses, student accommodation and social housing.

Creating greater choice and diversity of housing across the city has clear benefits—such as improved access to jobs, services and transport. For newly formed households, providing a diversity of housing may enable them to remain within a preferred location. For older couples, housing diversity may enable them to downsize to more compact accommodation within their neighbourhood.

Policy 2.5.1

Facilitate housing that offers choice and meets changing household needs

Policy 2.5.2

Provide a range of housing types in growth areas