Melbourne finds itself at the heart of a dramatic housing transformation, with the Victorian government implementing a suite of radical planning reforms that have taken even the most ardent advocates by surprise.
The Rise of the YIMBY Movement
For years, the narrative around new housing in Victoria was dictated by "nimby" (not in my back yard) sentiment, where residents frequently opposed developments in their local areas. However, a significant shift has occurred, propelled by the rise of the "yimby" (yes in my back yard) movement and a state Labor government keen to address affordability for younger voters.
Yimby Melbourne, formed in February 2023, quickly moved from what organisers expected to be a grassroots campaign into a group influencing systemic change. Jonathan O'Brien, the lead organiser, praised the government's willingness to listen to evidence and be forward-thinking. The group, which stresses it is not linked to developers, saw its advocacy for local housing targets and rezoning bear rapid fruit.
A Wave of Unprecedented Reforms
The pace of change has been staggering. In a concentrated two-year period, the government of Premier Jacinta Allan has rolled out a comprehensive package of measures designed to accelerate housing supply.
Key actions include announcing enforceable housing targets for local government areas and, in a major move, rezoning land around 50 train and tram stations to permit higher-density housing. This followed an earlier trial involving ten "activity centres".
The reforms extend much further. The state has introduced a fast-tracked townhouse code for low-rise apartments and duplexes, made subdivision easier, scrapped mandatory car-parking rules for new builds, and overhauled infrastructure contribution schemes.
The culmination was December's historic overhaul of the Planning Act, the most significant in decades. This legislation slashes approval times to as little as ten days and limits appeal rights primarily to direct neighbours. The government's own media release acknowledged the shift, headlined: "A Planning System That Says Yes In My Backyard – Literally".
Scale, Success, and Mounting Concerns
According to analysis by the Grattan Institute, where housing program director Brendan Coates sits on Yimby Melbourne's board, the scale of Victoria's ambition outstrips other states. The townhouse code and activity centre rezonings alone could add capacity for over 1.6 million new homes in Melbourne, equivalent to 70% of the existing housing stock.
Yet, the revolution is not without its critics and complications. Vocal protests have erupted in suburbs like Brighton, where taller apartment buildings are now permitted. The Planning Institute of Australia (PIA) has welcomed the focus on density but warns of a "very limited engagement with the planning profession".
Kat Smith, a senior PIA policy officer, argues the reforms lack a coherent, integrated agenda. She expresses concern that blanket rezoning ignores local context and that the townhouse code removes councils' ability to consider environmental hazards and local infrastructure adequacy.
Perhaps the most pressing challenge is economic. Coates notes that Melbourne has become a "victim of its success" in some respects. Increased housing capacity has kept price growth subdued compared to other capitals, but soaring construction costs—partly driven by the state's own infrastructure "big build"—mean many new developments are now financially marginal.
This tension is reflected in plummeting property sector confidence in Victoria, which sits 24 points below the national average, with two-thirds of industry respondents blaming state tax settings.
The Road Ahead: Heritage and Future Proofing
For reformers, the next frontier is clear: heritage protections. The Grattan Institute reports that 29% of residential land within 10km of Melbourne's CBD is under a heritage overlay. Advocates like O'Brien argue this often protects low-quality dwellings that could be better used for modern housing.
The Victorian government defends its approach, stating that first-home buyers shouldn't have to compete directly with foreign investors. As the construction pipeline adjusts to the new rules, the ultimate test will be whether this planning revolution delivers not just more homes, but the right homes in well-serviced communities, fulfilling the urgent needs of a growing population.
