Housing for all Australians is one of the biggest challenges we face.
In 2026, a couple with a moderate income of $97,000 can afford mortgage repayments for around 12 per cent of the homes on the market in Melbourne. A couple with a low income of $63,000 can afford repayments for around 3 per cent of homes. A family with a moderate income of $135,000 hoping to buy a detached house could afford the repayments for around 21 per cent of houses on the market in Melbourne.
A range of planning and housing initiatives have been introduced to support housing supply with a number of initiatives set out in Victoria's Housing Statement and through Plan for Victoria.
As part of the Government’s housing strategy planning system initiatives and reforms will be introduced to help address our housing challenges. These initiatives and reforms will help ensure housing supply can meet demand and facilitate the supply of more social housing and other affordable housing.
Read more about Victoria’s Housing Statement
To meet Victorians’ current and future housing needs, about 2.24 million more homes will be needed across Melbourne and our regional cities and towns over the next 30 years.
Plan for Victoria sets out a vision and actions to enable more homes to be built in the right locations, to provide more choice and more affordable housing options. The plan includes housing targets for every local government area across Victoria. This will ensure every planning scheme identifies enough opportunities to deliver the targeted number of homes.
Councils' planning schemes are being assessed to determine housing capacity and identify opportunities to meet housing targets.
New projects take more time if there are planning delays. The supply of housing can slow down and projects can become more expensive.
The Development Facilitation Program has been expanded as part of Victoria’s Housing Statement. The program includes a streamlined planning permit assessment pathway for medium and high density residential projects that provide affordable housing.
For further information, including eligibility criteria and affordable housing delivery requirements, read more about the Development Facilitation Program.
The Department is leading the whole-of-government delivery and coordination of priority precincts such as Arden, Docklands, Fishermans Bend, Footscray, East Werribee, Parkville, Sunshine, and the first six Suburban Rail Loop (SRL) precincts.
These priority precincts are well-connected locations being planned to deliver new jobs and homes.
It is expected that thousands of new homes will be built within walking distance of the first SRL stations in Cheltenham, Clayton, Monash, Glen Waverley, Burwood and Box Hill.
The Train and Tram Zone Activity Centres Program has put new planning controls in place around 60 train and tram zone activity centres that will support the development of more than 300,000 new homes close to public transport, jobs and services.
By working with local councils and the community, the plans for priority precincts and train and tram zone activity centres aims to create places where people have vibrant, liveable and sustainable communities, affordable housing and quality jobs which help to grow Victoria’s economy.
The Department is identifying more opportunities for affordable housing across Victoria through better utilisation of surplus government land. Through the Land Coordinator General and the Government Land Planning Service the Government is establishing partnerships with private sector developers to deliver new housing opportunities in areas close to transport, jobs and services.
The department is working to unlock and rezone surplus government land to deliver around 9,000 homes across 45 sites in both metropolitan Melbourne and regional Victoria.
The Government has set a target that at least 10 per cent of homes developed on surplus government land will be affordable housing.
In metropolitan Melbourne's greenfield areas, there are around 334,000 lots remaining, equating to approximately 19 years of supply. For the major regional cities, there are significant areas of greenfield residential land available in Geelong and Ballarat.
The Government has developed a 10-year Plan for Melbourne’s Greenfields. This 10-year Plan will provide a framework for industry to plan for 180,000 extra homes in our newest suburbs and identify opportunities for increasing the number and types of homes where sufficient infrastructure exists to ensure it is delivering housing choice in the right locations.
Government will regularly review the future pipeline of greenfield land supply to make sure it is delivering housing choice in the right locations.
The Planning and Environment Act 1987 (the Act) includes an objective ‘to facilitate the provision of affordable housing in Victoria.’
Affordable housing is housing, including social housing, that is appropriate for the needs of very low-, low- and moderate-income households.
A Governor in Council Order forms part of the definition of affordable housing under the Act. The Order specifies the income ranges for very low, low and moderate-income households for affordable housing that is not social housing. A Ministerial Notice specifies matters relevant to determining whether affordable housing is appropriate. The income ranges specified in the Order can be found below.
There is a growing desire among local councils to apply affordable housing provisions as part of both rezoning land, and permit applications in major developments. Local councils and developers are increasingly proposing new and innovative ways to deliver social housing and other forms of affordable housing.
These proposals include ways to harness the substantial increase in land value that can come from rezoning and other planning controls to deliver a community benefit such as affordable housing.
A Section 173 Agreement can be entered into for a range of outcomes, including affordable housing.
An example Section 173 Agreement has been developed to assist in the facilitation of negotiations for affordable housing provision. It is not mandatory to use any part of the example agreement.
Parties to a voluntary Section 173 agreement should refer to the Specified Matters under Section 3AA(2) – Ministerial Notice to determine whether the affordable housing they are negotiating is appropriate for the needs of very low, low and moderate income households. You can download a copy of the Notice.
A Responsible Authority must discharge its responsibilities fairly and reasonably. A Responsible Authority first needs to establish a strategic basis for requesting a Section 173 Agreement and can then seek to include a condition requiring a Section 173 Agreement for the provision of affordable housing on a planning permit.
The Responsible Authority should have evidence to support the condition, ensuring that it is defendable at VCAT should the applicant lodge an application for review. In most cases, a Responsible Authority is a local council, and a strategic basis could be made in a Housing Strategy that identifies the relevant housing requirements that need to be addressed within a defined location.
To ensure development feasibility and fairness, any affordable housing requirement secured through a planning permit condition for a Section 173 Agreement should be identified early and by agreement with the applicant.
A selection of planning scheme clauses that facilitate affordable housing are shown, this list is not exhaustive. A range of approaches are evident, where affordable housing contributions or section 173 agreements are mandated, these have been negotiated and agreed with landowners as part of a planning scheme amendment.
| Council planning scheme | Planning scheme clause |
|---|---|
| Bayside -municipal wide | |
| Glen Eira – East Village | Schedule 2 to Comprehensive Development Zone |
| Kingston – Former Kingswood Golf Course | Schedule 8 to Clause 43.04 Development Plan Overlay |
| Melbourne – West Melbourne | |
| Melbourne – Arden Precinct | |
| Monash – PMP Printing Precinct | Schedule 2 to Clause 37.02 Comprehensive Development Zone |
| Yarra – municipal wide | |
| Yarra - 81-95 Burnley Street and 26-34 Doonside Street, Richmond | Schedule 15 to Clause 43.04 Development Plan Overlay |
Yarra Ranges - Former Lilydale Quarry |
| Council planning scheme | Planning scheme clause |
|---|---|
Whittlesea - Epping Renewal Site | Schedule 39 to Clause 43.04 Development Plan Overlay Schedule to Clause 45.12 Specific Controls Overlay – Incorporated Document SCO16 |
Hume - Craigieburn West PSP |
| Council planning scheme | Planning scheme clause |
|---|---|
Greater Geelong - Saleyards Precinct Plan |
The Governor in Council Order (the Order) is published in the Government Gazette and updated annually to specify affordable housing income ranges as defined under the Planning and Environment Act 1987.
Table 1 and 2 are derived from annual area median income from the Australian Bureau of Statistics 2021 Census of Population and Housing and indexed using the Australian Bureau of Statistics Housing Group of the Consumer Price Index.
| Very low income range (annual) | Low income range (annual) | Moderate income range (annual) | |
|---|---|---|---|
| Single adult | Up to $32,250 | $32,251 to $51,590 | $51,591 to $ 77,390 |
| Couple, no dependant | Up to $48,360 | $48,361 to $77,390 | $77,391 to $116,080 |
| Family (with one or two parents) and dependent children | Up to $67,710 | $67,711 to $108,350 | $108,351 to $162,510 |
| Very low income range (annual) | Low income range (annual) | Moderate income range (annual) | |
|---|---|---|---|
| Single adult | Up to $23,500 | $23,501 to $37,620 | $37,621 to $56,420 |
| Couple, no dependant | Up to $35,260 | $35,261 to $56,420 | $56,421 to $84,640 |
| Family (with one or two parents) and dependent children | Up to $49,360 | $49,361 to $78,990 | $78,991 to $118,500 |
Parties to a voluntary Section 173 Agreement for affordable housing would refer to the Order to determine income eligibility of individuals and households targeted in negotiations.
If the affordable housing being negotiated is social housing, parties to a voluntary agreement can find further information at Housing Victoria.
Page last updated: 02/11/26
Social housing
The Big Housing Build is a public and community housing program delivering more than 16,000 homes across Victoria.
In addition, the High-rise Redevelopment Program is replacing Melbourne’s 44 high-rise housing towers with new well-designed, energy efficient housing development that will provide an overall 10 per cent increase in social housing across Melbourne.
We are investing $1 billion in a Regional Housing Fund to deliver more than 1,300 new homes across regional Victoria. The new homes will include a mix of social and affordable housing.
The $150 million Regional Worker Accommodation Fund will provide new housing options for regional communities where key workers are struggling to find affordable places to live.
For further information on the Big Housing Build and affordable housing being developed as social housing visit Homes Victoria.