New legislation to boost housing supply and combat land-banking

Published on 09 October 2023

Council has welcomed pending legislation to tackle long-term land banking practices.

Legislation introduced to the Victorian Parliament last week will extend the Vacant Residential Land Tax (VRLT) – currently applied to empty residential properties in Melbourne’s inner and middle suburbs for more than six months – to unoccupied residential properties across the entire state.

The move aims to alleviate the strain on the housing market by increasing the availability of properties for occupancy and is anticipated to have a positive impact on the rental market, effectively bolstering housing stock and mitigating pressure on rents and property prices.

Crucially the changes will also apply to residential land that has been undeveloped for more than five years in established areas of Melbourne, to discourage long-term land banking and encourage new housing developments.

This specific change will close a loophole where VRLT did not apply to unimproved land – enabling this land to slip through the cracks, despite being ready for development.

Mayor, Cr Sarah Carter welcomed the announcement, emphasising its significance in addressing longstanding land-banking issues in the municipality.

"This new legislation aligns with our ongoing efforts to combat land-banking challenges locally particularly in Footscray CBD. We believe these changes will pave the way for more responsible and timely development, improving the supply of housing and increasing commercial floor space – ensuring that our City grows sustainably.”

Council has been working with key landholders of a number of derelict and vacant sites to facilitate action and Cr Carter said it fully supports Government’s decision to enact changes that will encourage developers to act upon planning permits within a reasonable period of time.

Maribyrnong News

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