Nick shares his insights on urban planning in Victoria – the trends, the challenges and the opportunities

There’s a lot of discussion about the challenges we're facing in the property development industry. We all know about the cost of living crisis, rising interest rates, council delays and limited land releases.  It’s time to switch to solutions mode and talk about how we can propel the industry forward, together. That’s what our Market Reset series is about.

This month, we’re chatting to Nick Hooper about urban design planning in Victoria – the  trends and the need for regulatory changes to support housing availability, quality and affordability. As Director of Planning at Taylors, Nick oversees major projects including land, medium-density and mixed-use developments.

With over 32 years in the industry, Nick has a solid understanding of what works, what doesn’t, and what needs to change moving forward.

Q: What key changes have you seen in the property development industry over recent years from a planning perspective?

A: Changes tend to occur when the market is active so the last 12 months have been fairly stable. Looking at the last 10 to 15 years, we’ve seen a lot of changes in the type and size of housing product. We’ve reached a point where lot sizes are pretty much as small as they can go.

When the Small Lot Housing Code came into effect in 2011, it changed the market from lots of 300m2 and over plus medium density sites, to lots as low as 100m2 to 150m2 with very few medium density sites. You ended up with a fairly tight mix of lots with 8-, 10- and 12.5-metre-wide frontages and then some narrower product that had to be rear-loaded because the frontages got too narrow to facilitate a front-loading crossover. 

There are very few lots of more than 500m2 now and there’s more two-storey housing product. People are prepared to sacrifice the size of their backyard to maintain living space. The amount of floor space has remained relatively stable, and people take their outdoor space in the communal areas that form part of the subdivision – the public open spaces and the substantial creek environs that exist in a lot of the new estates.

Q: Where do you see the urban design industry heading in the next 12 months?

A: There’s not a lot of room to move because you can't significantly increase densities without going to an apartment-style product. I don't think most growth areas are going to be ready for significant amounts of apartment-style product in the short term because the cost of producing apartments is often no cheaper than producing a house on a small lot. I believe buyers in growth areas will choose a house on a small lot over an apartment if they are about the same price.

Every lot needs to front a road, so if lots reduce in size even further the proportion of road to land for sale starts to get disproportionate. Until you get a market shift where apartments can be produced cheaper than houses on small lots, you're going to see a continuation of what we've been doing for the last little while which is a density of about 18 to 21 lots per hectare for conventional development going up to 25 lots per hectare in walkable catchments.

Q: What barriers are you facing in the planning industry? What needs to change to overcome those hurdles?

A: Planning is never going to solve everything because there will always be sites with permits where nothing gets built. What planning can do is get everything planning-ready, so that a permit can be granted, a plan can be endorsed, and a project can get going if it's commercially viable.

We need a process that gets PSPs in place so that broad acre land is planning-ready without it taking the inordinate amount of time that it does now. Whether that's looking at the PSP process itself, or more broadly at the planning scheme amendment processes, the government needs to undertake reform.

When the Growth Areas Authority was set up 20 years ago, it got things going in an organised manner. Now, we’re back to a process that takes ridiculous amounts of time with a government that has hardly started or finished any PSPs in recent times.

Q: What specific changes would you like to see when it comes to government reform?

A: The State Government announced that they wanted to see a 70/30 split where houses were provided – 70% in established areas and 30% in the growth areas. That’s fine in theory but it’s been uneconomical to develop in established areas in any meaningful way.

We still face archaic planning processes and policies. For example, where a covenant sits on a title and restricts development to one dwelling on the lot, the council can’t grant a permit for something that contravenes the covenant due to provisions in the Planning and Environment Act. If government is serious about the 70/30 split, it needs to remove those provisions from the Act so more established areas can be developed. 

We also need to move to a code-assessable approach whereby you make an application to the council pointing out how you comply with everything in the code and if the council agrees, they grant the permit. Then the market will decide whether the project is financially viable to go ahead.

I’d also like to see the emphasis on neighbourhood character only applied to areas where it can be justified. At the moment, the neighborhood character provisions in Clause 55 hold up and influence applications in neighbourhoods where the character isn’t significant enough to warrant that level of protection. Where there is significant heritage or neighbourhood character, those matters can be considered in the permit application via the Heritage Overlay or Neighbourhood Character Overlay.

Q: Are you confident that these reforms will happen at some stage?

A: I’m not sure the government will be politically brave enough. To date, they’ve only made minor changes around the edges, nothing substantive. I am buoyed by the appointment of Colleen Peterson to the Head of State Planning role at the Department of Transport and Planning. Colleen is a very experienced professional who has gone into the role to facilitate change. I look forward to seeing what she can achieve so that we can get more land planning ready and deliver more houses.

Thank you to Nick for sharing his knowledge and insights from a planning perspective. We’d love you to share your thoughts in the comments. Let’s keep the conversation going so we can navigate the challenges we’re facing and drive the property development industry forward.

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