Welcome to the July Edition of KLM Spatial’s Industry Updates.
Critically endangered Victorian grassland earless
lizard habitat threatened by land sale limbo
Critically endangered Victorian grassland earless lizard habitat threatened by land sale limbo –
ABC News Scientists are worried the rare lizard will go extinct in the wild unless the government buys the only private property where it has been found, according to a story by the ABC. It was 2.5 years ago on a sheep farm west of Melbourne, a lizard species thought extinct
was discovered.
The family that owns the property has faced a stressful conundrum as they try to conserve the species amid drought, dropping wool prices and rising farm costs. With the preservation of the lizard in mind, the family has refrained from changing grazing practices used since World War II. Ecologists say any grazing management changes could be disastrous for the remaining lizards.
The farm owners want to sell the portion of their land suitable for conservation to the Victorian government.
But the state government won’t buy them out because the property is not part of the MSA. In 2010, the Victorian government created the Melbourne Strategic Assessment (MSA) program, agreeing to purchase 15,000 hectares of private land containing the grasslands to create the Western Grassland Reserve. Around 98 per cent of the grasslands have been lost since European colonisation.
The property in which the dragons were found doesn’t fall into the acquisition zone that was drawn up by the state before the rediscovery. There is provision to vary the MSA, however nothing is being done to include the lizard habitat in the new reserves.
A spokesperson for the government says it is working with stakeholders to “deliver a successful conservation breeding program for the Victorian grassland earless dragon with the commonwealth government”. The commonwealth has ruled out purchasing the land.
Many new projects in western Melbourne, Geelong and around Bacchus Marsh are being held up while the government determines what action to take following the rediscovery.
A habitat distribution model has been created to map potential habitat to inform
conservation planning, support strategic land use planning and recovery of the VGED. And while 15,000 hectares of land was supposed to be purchased by 2020 for the reserve, so far about 4,000 hectares (or 26 per cent of properties) have been bought by the Victorian government.
Commercial property rollercoaster sliding into 2026
Commercial property tipped to strengthen in 2026 but economic obstacles remain.
I picked this article for the graphs! It does tend to waffle a bit about the state of the economy and commercial property sector, so the highlights are:
- GDP growth for the March quarter was just 0.2% compared to 0.6% in the previous quarter.
- Retail sales slipped and natural disasters are estimated to have cost the economy $2.2 billion.
- The on-and-off again US tariff policies have impacted confidence in investment, output and
employment in Australia. - However according to Ben Burston, Knight Frank Chief Economist, the worst of the economic
news is behind us and anything in front has already been priced into market expectations. - Rate cutting cycles overseas and now here have lead to “buoyed sentiment” in the local
commercial property sector. - The development pipeline is quickly thinning out, but asset values are well below replacement
cost and current market rents are below the level required to trigger new development at scale. - JLL Research reports industrial land is set for its strongest growth since Q3 2022, with
Melbourne accounting for 64.3% of quarterly supply. - Melbourne is also tipped so see the commercial vacancy rate decrease by 0.8% to 4.1%.
- Retail vacancy levels in the major CBDs, which had been very high in recent years, are now
reducing. Hospitality, food and beverage and entertainment operators made up the largest
proportion of new tenants over the past 12 months. These businesses are also subject to high
insolvency rates due to rising rents, wages and energy costs. - Population growth creates more customers for existing businesses and it also brings in people wanting to establish their own businesses, especially in the suburbs/regional towns.
Property News Updates, PCA
Property rush before the winter break
The government moved an amendment to the now-passed State Taxation Acts Amendment Bill 2025, removing the legislative requirement for a minimum lease term for build-to-rent. The Bill enables the government to make regulations on a potential minimum lease term at a later date.
Discussions continue on the Planning and Environment Act 1987 reforms to remove red tape and streamline current processes, with more announcements imminent. The government has announced the creation of an independent expert panel to review the Owners Corporation Act 2006.
The expert panel will examine stakeholder concerns related to OCs, including voting thresholds among lot owners. Currently, common property owned by an OC can only be sold if all lot owners agree.
The Property Council is advocating for this threshold to be reduced to 75
per cent like in NSW.
The government introduced the Domestic Building Contracts Amendment
Bill 2025 to the Lower House, by:
• Updating rules around when and how builders get paid by prescribing
deposit limits
• Allowing the use of cost escalation clauses for works with a contract
price of $1m or more to manage unforeseen costs; and
• Removing the preparation of plans, specifications and bills of quantity
from the domestic building work definition.
Enabling modern methods of construction
Enabling modern methods of construction, Engage Victoria.
The government is embarking on reform to promote the efficient and effective delivery of safe, compliant, durable, affordable, and sustainable buildings. As part of this delivery, the government is seeking feedback on a discussion paper that explores
how modern methods of construction can be enabled through effective building regulation.
More Homes For Clayton As SRL Major Works Begin
Premier Jacinta Allan, Minister for Suburban Rail Loop Harriet Shing and Minister for Planning
Sonya Kilkenny recently announced major construction on the SRL Clayton Station has started and 317 build-to-rent homes on Carinish Road have been approved via the DFP.
The government is promoting the DFP’s fast-tracking approvals across the SRL precincts in Box
Hill and Clayton of around 2,000 homes. Major Projects understands a pre-commencement
condition of approvals requires payment of an infrastructure contribution levy, which has not been resolved. Last year the government announced a development contributions pilot for the first 10 activity centres, that will not commence before 2027.
Shepparton South East PSP approved
Minister for Planning Sonya Kilkenny has approved the Shepparton South East PSP, unlocking land for more than 2,900 new homes and creating space for over 7,000 future residents.
In 2022 Goldfields purchased 44 ha inside the PSP for $15 million with the intention to commence construction in 2025. They are now in the planning phase for approximately 500 residential lots.
Property investors are back, including in Victoria
Property Investors Are Back, But Not Where You’d Expect
Australia’s investor market is making a comeback and in typical fashion, it’s not happening where the headlines are the loudest.The latest Mortgage Insights report from Money.com.au reveals a sharp uptick in investor lending across most states.
For the first time since mid-2023, investor loan growth in Victoria has overtaken owneroccupier lending, rising by 12% over the year to March 2025 compared to just 8% growth for owner-occupiers.
That’s a reversal worth noting – Victoria has traditionally been dominated by owner-occupiers, but that’s starting to change. And according to Alex Dore, Mortgage Expert at Money.com.au, the shift isn’t just statistical, it’s strategic:
“There’s a renewed surge of confidence from property investors in the Victorian market.This is driven by expectations of capital growth as house prices in Victoria have not fluctuated like other capital markets, and a strategic return to inner-city and highgrowth suburbs.”
Interestingly, the investor resurgence is being led by construction loans (up 17%) and lending for existing homes (up 13%), a sign that investors are targeting a mix of new development opportunities and quality established stock in desirable locations.
At the same time, Victoria still recorded the highest growth in owner-occupier loans for established homes (up 11%) , nearly double the national average. That tells us both ends of the market are active in Victoria, which tends to reinforce underlying demand and price stability.
In January, the AFR reported the number of rental bonds in Victoria dropped almost 4% (more than 24,700 properties) in 18 months to September 2024.
However at the time, the underlying signs were more positive with official home loan data showing the value of new loan commitments to property investors nationally picked up to $125 billion in the year to September, the seventh straight
month of year-on-year growth and a 26 per cent increase on a year earlier.
