Melbourne's Housing Density Reform Sees Latest Developments and What Happened This Week

This week, the Victorian government announced plans to amend the Melbourne Planning Scheme to allow for increased density in select areas, including the St Kilda Road precinct and parts of the inner-north, such as Brunswick and Fitzroy. The move is part of a broader effort to address Melbourne's housing affordability crisis, with the government aiming to build 70,000 new homes by 2030.

The push for increased density is driven by Melbourne's rapid population growth, which has put pressure on the city's housing stock and driven up prices. According to data from the Australian Bureau of Statistics, Melbourne's population grew by 2.3% in the year to June 2025, with the median house price reaching $943,000. The government's reforms aim to increase the supply of housing, particularly in areas with good access to public transport, such as the tram corridors along St Kilda Road and Sydney Road in Brunswick.

Local Implications and Concerns

In Melbourne's inner suburbs, the proposed reforms have sparked concerns about the impact on neighbourhood character and the strain on local infrastructure. The City of Yarra, which includes suburbs like Fitzroy and Collingwood, has expressed concerns about the potential for over-development and the need for more community consultation. Meanwhile, the Victorian Trades Hall Council has welcomed the reforms, citing the need for more affordable housing and the potential for increased construction activity to boost the local economy.

According to data from the Real Estate Institute of Victoria, the median apartment price in Melbourne's inner suburbs is $640,000, with prices in areas like Southbank and Docklands reaching over $1 million. The government's reforms aim to increase the supply of affordable housing, with a target of 10% of new developments being reserved for social housing. However, critics argue that more needs to be done to address the root causes of housing unaffordability, including the impact of investor demand and negative gearing.

In practical terms, the reforms will see changes to the Melbourne Planning Scheme, including increased density limits and new design standards for apartments. The government has also announced plans to invest $10 million in community infrastructure, including parks and community facilities, to support the increased population density. As the reforms progress, Melburnians can expect to see more high-rise developments and increased construction activity, particularly in areas like St Kilda Road and the inner-north.