Welcome to the June Edition of KLM Spatial’s Industry Updates.
Winter is officially here!
Bass Coast Draft Planning Policy Released
The Minister for Planning has unveiled the draft Statement of Planning Policy (SPP) for the Bass Coast, outlining a long-term vision to guide land use and development over the next 50 years.
A key element of the draft is the proposal for 24 protected settlement boundaries, intended to establish clear limits for future growth. These designated areas will need to offer sufficient, well-serviced land for residential, commercial, and industrial use. Boundaries for Inverloch and Wonthaggi are still under review and will be determined through further public consultation.
The draft policy anticipates the need for approximately 10,000 new homes by 2036, aligning with Plan Victoria’s broader projection of around 20,000 additional dwellings in the Bass Coast by 2051. Data from the 2021 Census shows that 27% of properties in the designated area are currently used for holiday homes or short-term rentals.
The proposed settlement structure for the region is outlined as follows:
Regional Service Centre – Wonthaggi
District Towns – Cowes, Inverloch, San Remo
Towns – Grantville
Villages – Including Cape Paterson, Cape Woolamai, Corinella, Coronet Bay, Dalyston, Kilcunda, Newhaven, and Rhyll
Hamlets – Various smaller localities
Since being officially recognised as a Distinctive Area and Landscape in October 2019 under Part 3AAB of the Planning and Environment Act 1987, the Bass Coast region has been subject to policies that support the development of an SPP and enable long-term protection of township boundaries.
https://engage.vic.gov.au/project/distinctive-areas-and-landscapes-program/page/bass-coast
Builders Slash Prices and Loan Rates to Revive Victoria’s Construction Industry
Melbourne’s major home builders are rolling out major discounts and offering low-interest home loan deals in an effort to revitalise Victoria’s struggling construction sector.
Although government infrastructure projects continue to drive demand and costs for skilled trades such as plumbing and electrical work, many leading residential builders are streamlining home designs and eliminating premium finishes to bring build prices below $200,000 — a significant drop from the state’s average of $505,000.
Metricon reports that the introduction of minimum seven-star energy efficiency standards has added between $15,000 and $20,000 to typical construction costs over the past year. Even so, the company is promoting a home tailored to first-home buyers priced at approximately $183,000, with further discounts of $20,000 to $60,000 available on selected designs.
In another effort to attract buyers, Burbank and YourLand Developments have partnered to offer a competitive 3.49% variable interest rate home loan for the first two years through National Pacific Finance.
Current advertised build prices include:
Sherridon Homes from $169,700
Metricon Homes from $182,500
Mimosa Homes from $199,000
To keep prices down, Sherridon Homes’ “Essence” series features more compact floorplans, simplified structural elements like wall and roof profiles, and cost-effective materials such as laminate benchtops instead of stone.
These initiatives reflect a broader industry shift toward affordability and practicality, as builders work to meet market demand amid rising costs and regulatory changes.
Key Property Bills Progress Through Victorian Parliament
It’s been an active week in Victoria’s Parliament with three major pieces of legislation advancing — all with significant implications for the property sector, according to the Property Council of Australia (PCA).
Retirement Villages Amendment Bill 2024
The Retirement Villages Amendment Bill has passed, incorporating changes from both the government and the Animal Justice Party. Most of the new regulations are scheduled to take effect by 1 May 2026, providing operators with time to prepare.
The bill updates the Retirement Villages Act 1986 with a focus on modernising regulations and boosting protections for residents, particularly in relation to financial and contractual arrangements. The reform follows heightened scrutiny after a 2024 ABC investigation revealed the financial challenges faced by some older Australians trying to exit retirement village contracts, including high fees and ongoing obligations.
One of the key outcomes of the legislation is the introduction of a mandatory code of practice, designed to ensure consistent standards across all retirement villages — a central concern raised in the ABC report. Attempts by the Opposition to introduce amendments addressing capital maintenance responsibilities were unsuccessful.
Building Legislation Amendment (Buyer Protections) Bill 2025
This Bill has cleared the Upper House and is set to come into effect from 1 July 2026.
It includes several major reforms:
Establishing the Building and Plumbing Commission (BPC), which will centralise building quality oversight and boost enforcement and disciplinary capabilities.
Launching a ‘first resort’ building warranty insurance scheme, enabling consumers to claim for issues such as defective work or lost deposits without needing to exhaust other remedies first.
Granting the BPC authority to issue rectification orders, potentially limiting occupancy permits or off-the-plan sales if serious defects are not addressed.
Requiring developers of buildings four storeys or higher to contribute to a Developer Bond Scheme, lodging a 2% bond (equivalent to $1 million for every $50 million in build cost) for a two-year period.
While the reforms aim to strengthen consumer protection and builder accountability, industry leaders — including the PCA — have raised concerns about the timing, noting the added pressure on an already strained sector due to rising construction costs and high property taxes.
State Taxation Acts Amendment Bill 2025
Still awaiting final approval in the Upper House, this Bill includes a proposed amendment to the Land Tax Act 2005. Beginning 1 January 2026, Build-to-Rent (BTR) operators must offer leases of at least 12 months to qualify for land tax concessions.
The PCA has urged the government to reconsider, suggesting either the removal of the fixed-term lease requirement altogether or a more flexible approach — recommending a minimum lease of 3 months and an extension of the maximum qualifying lease period from 3 to 5 years.
Softwood Plantations to Expand as Timber Demand Grows
To support Australia’s ambitious housing targets, a major shift is underway in one of the country’s most significant forestry regions, spanning the border of Victoria and South Australia.
The area, home to around 334,000 hectares of plantation forest, currently accounts for approximately 17% of the national forestry industry. It produces both softwood, like pine — widely used in domestic building — and hardwood, such as blue gum, which is largely exported for use in paper and pulp production.
Over the next five years, this region is set to transition to a softwood-dominant landscape, with a strong focus on radiata pine. This shift reflects growing demand for construction timber as Australia works toward delivering 1.2 million new homes by 2029. The move also aligns with increasing interest in carbon markets, as radiata pine’s longer growth cycle of about 30 years offers better carbon sequestration potential than blue gum, which matures in roughly seven years.
The change in forest use follows the end of native timber harvesting in Victoria’s state forests, which ceased on January 1, 2024. This was part of the state’s Forestry Transition Program, designed to protect biodiversity, boost regional economies, and expand public use of forested areas.
https://amp.abc.net.au/article/105371902
