What data informed these insights
The Australian Bureau of Statistics (ABS) release data on residential building approvals. The data show that the number of approvals for detached houses in Victoria is at all-time highs.
The Department of Environment, Land, Water and Planning monitors and analyses residential land supply. This is reported in the Urban Development Program. The report shows that there is more than enough supply of residential land in Melbourne’s growth areas to meet demand.
Approvals of detached houses at all-time highs
Victoria saw a record number of approvals of detached houses from the September quarter 2020 to the March quarter 2021.
The number residential building approvals for detached houses increased from about 9,000 in the March quarter 2020 to 12,000 in the March quarter 2021. The number of approvals in the March quarter far exceeds the previous quarterly record of over 10,300 seen in the June quarter 2018.
Figure 1: Quarterly number of building approvals of detached houses, Victoria. Source: Building Approvals, ABS
Much of the increase in the number of detached house approvals were in Metropolitan Melbourne’s growth area municipalities. The five growth area municipalities are Cardinia, Casey, Hume, Melton, Whittlesea, and Wyndham. These municipalities saw nearly 22,000 residential building approvals for houses in the 12 months to March 2021.
Figure 2: Quarterly number of building approvals of detached houses by region, Victoria. Source: Building Approvals, ABS
Planning has ensured there land to meet the surge in demand
The sudden and significant increase in approvals for detached houses was possible because there has been enough land. This was because there was a substantial pipeline of strategic land supply. There were also enough retails lots, or land going through the subdivision process.
The Department’s Urban Development Program found that at the end of the 2019 calendar year, there were around 43,000 proposed lots in the growth areas. These proposed lots in the pipeline enabled the release of a record 22,700 lots to end users to build houses on in 2020.
Figure 3: Number of proposed greenfield lots, by growth area, December 2019. Source: DELWP Urban Development Program