Melbourne (Victoria): Townhouse & Low-Rise Code + Activity Centres

Victoria's current wave of housing reform traces back to a single document. On 24 September 2023 the state government released Victoria's Housing Statement: The decade ahead 2024–2034. It set a long-range target: build 2.24 million new homes by 2051, the number the government says Victoria will need as its population grows. Of that total, 425,600 homes are to be built across regional Victoria, with the rest concentrated in greater Melbourne.

The number to anchor on is 2.24 million by 2051. Other figures circulate in news coverage, for example an interim goal of 800,000 homes through an affordability partnership, but those are shorter-term or sector-specific milestones, not the state-wide 2051 target.

The Statement also reset where growth is supposed to go. For years Victoria has held a policy goal of putting most new housing inside areas that are already built up rather than on the city's edge. The government's stated aim is for 70 per cent of new homes to be built in established areas and 30 per cent in greenfield growth areas. That single split, often called the 70/30 goal, explains almost everything that followed. If most new homes must fit inside existing suburbs, the rules governing what you can build on an ordinary residential lot become the central lever. The two reforms below are how the government pulled it.

The first major mechanism is a rewrite of Victoria's residential design rules. Announced on 28 February 2025, the reform renamed the long-standing planning provision known as Clause 55 as the Townhouse and Low-Rise Code and added a new Clause 57 covering taller apartment buildings. The new deemed-to-comply standards were approved on 6 March 2025 and commenced operation on 31 March 2025, applying to applications lodged after that date.

The Code covers duplexes, townhouses and apartment buildings up to three storeys under Clause 55. The separate Clause 57 applies to larger residential buildings of four to six storeys and works differently, as covered below. The split matters: the strongest version of the reform sits in the three-storey-and-under band, which is exactly the scale of a gentle-density multiplex.

The new approach replaces a lot of case-by-case judgement with a fixed checklist. Under the old system, a designer had to satisfy a planner that a project met broad objectives, and the planner had room to disagree. Under the Code, the rules are written as deemed-to-comply standards: measurable numbers for things like building height, setbacks from boundaries, overshadowing and private open space. Meet every applicable standard and the project is treated as compliant by definition. The planner no longer reweighs whether the design is acceptable; the design is acceptable because it hits the numbers.

The part that makes the Code powerful is what happens to the neighbours' ability to object. In most planning systems, once a permit application is lodged, nearby residents can be notified, lodge objections, and appeal an approval to a tribunal. Each of those steps adds months and uncertainty, and the threat of an appeal often pushes applicants to shrink or redesign a project before it is even decided.

The Code removes that lever for compliant projects. Because the deemed-to-comply standards are treated as already protecting neighbours, a development that meets every applicable standard gets no third-party notice or appeal rights. As one legal summary put it, where all applicable standards are satisfied, residents will not be able to appeal a development that has been deemed to comply with the Code. The planning authority's own guidance is blunt: because the Code already includes strong protections for neighbours, there is no right of appeal for planning applications that meet these standards.

This is the central trade the reform makes. The designer gives up flexibility and must build strictly to the rulebook. In exchange, the project gets a faster, more certain path and is shielded from the objection-and-appeal process that can stall ordinary infill housing. For a small builder, that certainty is worth more than discretion: a project that pencils out on a known timeline is financeable, while one exposed to an open-ended appeal is not.

The reform is not unlimited. The four-to-six-storey Clause 57 deliberately keeps the old rules in place: there is no exemption from third-party review rights under Clause 57, and the responsible authority must still weigh the usual decision guidelines. The fast track is reserved for the smaller, lower-rise buildings the government most wants to encourage.

The second mechanism targets specific places rather than every lot. The Activity Centres Program rewrites planning rules in and around the commercial and transport hubs dotted across Melbourne, allowing taller and denser housing close to stations and tram lines. The logic is straightforward: concentrate new homes where people can reach jobs and services without a car.

The program began with a pilot. In 2024 the government started planning and consulting on the first 10 activity centres, intended to deliver 60,000 new homes close to public transport, jobs and services. The 10 pilot centres are Broadmeadows, Camberwell Junction, Chadstone, Epping, Frankston, Moorabbin, Niddrie (Keilor Road), North Essendon, Preston (High Street) and Ringwood. The plans for those 10 centres were finalised in April 2025.

Beyond the pilot, the government is extending the same approach to a wider set of hubs. It is seeking to change planning rules in and around train and tram zone activity centres to encourage more than 300,000 new homes around Melbourne's train and tram lines by 2051. There is a discrepancy in how many centres the expansion covers. The state planning authority describes the full program as targeting roughly 60 activity centres in total, while the original framing presented the work as the 10 pilot centres plus an expansion of around 50 more train-and-tram-zone centres. Whichever count is used, the structure is the same: 10 pilot centres already planned, plus a much larger expansion rolled out in stages. The expansion has moved in tranches, with later groups of centres finalised through to 31 March 2026.

It is worth being clear about what these numbers represent. The 2.24 million homes by 2051, the 300,000 homes around transit, and the 60,000 homes across the 10 pilot centres are all targets and capacity estimates, not homes that have been built. They describe how many dwellings the new rules are designed to allow, not how many will actually be delivered.

The gap between the two is the real test. Zoning sets the ceiling on what is permitted; whether homes get built depends on construction costs, interest rates, labour and materials, and whether individual projects make financial sense for the people who would build them. A lot can be zoned for six dwellings and still hold one house for a decade if the numbers do not work. Industry research in Victoria has repeatedly flagged that infill feasibility is a binding constraint, meaning many sites the policy unlocks on paper may not be economic to develop in practice. The reforms remove a major obstacle, the planning risk, but they do not remove the financial ones. Readers should treat the headline figures as the size of the opportunity the rules create, not a forecast of completions.

The reforms have not been universally welcomed, and the friction is worth understanding because it shapes how the rules get applied on the ground. The most contested element is the removal of objection and appeal rights. Stripping neighbours of the ability to be notified or to appeal a compliant project is, by design, a transfer of power away from local opposition and toward applicants and the state. Supporters argue this is exactly the point, since the old objection process was a reliable way to delay or shrink badly needed housing. Critics see it as a loss of community voice over neighbourhood change.

Councils sit in the middle of this. The Activity Centres Program and the Code both shift significant planning control from local government to the state, which has caused tension with municipalities that previously set their own neighbourhood character rules. Several Melbourne councils have published guidance to residents explaining the new Code and what it changes about their objection rights, for example Yarra City Council and Manningham Council, a sign that the change landed as a substantive shift in who decides what gets built. Industry groups, meanwhile, have questioned whether the underlying 70/30 split between established and greenfield areas is realistic, with one builder body arguing it may be time to give up on the 70/30 goal as a planning assumption. The reforms are firmly in place, but the debate over whether they go too far or not far enough is ongoing.

For a BC audience, the most useful comparison is the province's own Housing Statutes (Residential Development) Amendment Act, 2023, known as Bill 44, introduced on 1 November 2023. The two reforms arrived on opposite sides of the Pacific within roughly eighteen months of each other, and they reach for the same lever.

Bill 44 requires most single-family and duplex lots in BC to allow three or four units depending on lot size, and up to six units on larger lots near frequent transit, without a rezoning application. The mechanism that makes this work is the same one Victoria used: Bill 44 prohibits public hearings for projects that are already consistent with a municipality's Official Community Plan. Public hearings remain only where a council is updating its plan or considering a rezoning that does not fit the plan.

That is the deemed-to-comply idea in a different legal dress. In both places, if a project follows the rules the community has already adopted, the public-objection step that used to gate it is removed. Victoria writes the rules as fixed design standards and exempts compliant projects from notice and appeal; BC writes the rules into zoning and the Official Community Plan and removes the public hearing for projects that conform. Different drafting, identical logic: move the public's say to the up-front rule-making stage, then let conforming projects through without a case-by-case fight. One difference worth noting is scope. Bill 44 set hard provincial deadlines for local governments to update their bylaws, with first reviews due by 30 June 2024, and the changes did not apply to the City of Vancouver, which the province said it would work with separately.

The Victorian experience is a live test of a bet BC has also placed: that the fastest way to get gentle-density housing built is to remove the discretionary objection step, not just to raise the permitted number of units. Both governments concluded that allowing more homes on paper achieves little if every project can still be delayed or downsized through case-by-case opposition. The real unlock is procedural, removing the veto, and only then does the higher density get used.

For property owners and small builders in BC, the practical lesson from Victoria is about certainty. The Townhouse and Low-Rise Code is valuable less because it permits three storeys and more because a compliant project cannot be appealed, which means a known timeline and a financeable plan. BC's prohibition on public hearings for Official Community Plan-consistent projects delivers the same benefit: a small-scale multi-unit project that conforms to local zoning should move through approvals without the open-ended hearing risk that used to stall infill.

The caution from Victoria is equally important. Cutting objection rights speeds approvals, but it does not by itself make a project build. Whether BC's allowed densities translate into completed homes will depend, as it does in Victoria, on construction costs and project economics, not on the zoning alone. The two reforms confirm that removing discretionary objection is a necessary step for gentle density at scale. They also confirm it is not a sufficient one. For VanPlex's work analysing multiplex feasibility in BC, that is the operative point: the planning path is clearing, and the decision now rests on whether the numbers work on a given lot.