The Victorian Government is moving to simplify and speed up planning approvals for suburban housing, with new rules set to allow property owners to build or subdivide with far less red tape.
Premier Jacinta Allan and Planning Minister Sonya Kilkenny announced that from October, homeowners will be able to access fast-tracked subdivision and second-home approvals under changes to the VicSmart planning process. The aim is to reduce turnaround times from the current average of over 60 days to just 10 business days.
The updated system will allow Victorians to build a second home in their backyard, replace a single dwelling with two, or split their block and sell off part of it. While key standards for siting, privacy and design will still apply, the process will become dramatically quicker and less expensive, saving applicants more than $2,400 in fees on average and removing what the Premier called “stress and uncertainty”.
Speaking at the launch, Premier Allan said the changes would unlock opportunities for younger buyers and growing families. “I want to get millennials into homes—and so many people in their 30s are looking at new townhouses and homes on subdivided blocks that have a couple of bedrooms and space for the kids to run around. It works for them.”
She added that every faster approval “opens a door for young people to live where they want—near the things they need and the people they love”.
The move is part of a broader push to boost housing supply in suburbs close to jobs, schools and public transport, responding to strong population growth and rising housing demand. It follows earlier reforms introduced in December 2023, which made it easier to build small second homes or granny flats without needing a planning permit. More than 500 of these have already been approved, generating over $140 million in investment.
Minister Kilkenny said the new rules would enable homeowners to tap into the value of their existing land while contributing to broader housing needs. “These changes will boost housing supply in a way that’s sensitive to every street, whether you’re building a second home for your children or selling off your backyard to help someone else buy theirs,” she said.
“For many people, the biggest housing opportunity is right behind them—in their own backyard. That’s an opportunity for someone else, too—a young family, a first home buyer or a downsizer.”
The Government stressed that protections such as heritage overlays and environmental safeguards will remain in place to ensure that new developments fit into the character of existing neighbourhoods.
Housing Minister Harriet Shing added that the economic benefits would extend beyond housing supply. “By making it quicker to subdivide and build, we’re unlocking thousands of new projects that will boost construction, create jobs and deliver more homes in the suburbs where people want to live,” she said.
Premier Allan summed up the approach with a nod to community sentiment and practicality. “I can’t think of too many losers when it comes to townhouses and I believe the community is ready to see more of them. Everyone has evolved on this. But the planning rules haven’t. It’s still too hard in this state to subdivide your property and build a townhouse.”
The changes mark a shift toward aligning planning rules with growing public acceptance of townhouse-style developments and the need to make better use of available land in established suburbs.
The streamlined VicSmart approvals will begin from mid-October, offering a faster and cheaper option for Victorians seeking to add a second home or subdivide a property. As the Premier put it, Victoria will soon have “a system that says yes in my backyard—literally.”
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