I’ve been working in digital marketing since 2010, and for several years I was at Australia’s 3rd biggest property website where I grew organic traffic by a million extra unique users per month. During that time, I watched thousands of property listings come and go, and I learned something important: property news that sounds boring usually impacts your wallet the most.
So let me translate what the Victorian government just announced, because the headlines don’t tell you the full story.
What Actually Happened
In late February 2025, the Victorian government named another 25 suburbs as “activity centres” where planning controls will be seized from local councils to fast-track higher-density housing. South Yarra, Prahran and Windsor are among the inner-south suburbs specifically targeted, joining 25 other areas already announced last year.
Premier Jacinta Allan says the government wants to build 300,000 homes across all 50 centres by 2051, which sounds like a long way off until you realise that’s only 26 years from now. For context, that’s less time than it took for Chapel Street to go from hippie central to upscale fashion boutiques.
The government chose these areas because they’ve got train stations, trams, jobs and services already in place. Which makes sense on paper. Build near transport, people can get to work, problem solved. Except it’s never that simple.
The Real Story Behind The Planning Grab
Here’s what they’re not shouting from the rooftops: when the plan was first announced last year with the initial 25 zones, the government proposed buildings between 10 and 20 storeys around stations, with “gentle, scaled height limits” of three to six storeys in nearby walkable areas. But the February announcement didn’t specify any height limits at all.
That’s not an oversight. That’s a strategy.
I worked in agencies where clients spent huge marketing budgets without clear targets, and you know what happens? Costs blow out and nobody’s accountable. Same principle applies here. No specified height limits means developers will push for maximum density, councils will fight back, and residents get caught in the middle arguing over whether their street deserves an 8-storey or 15-storey building next door.
What This Actually Means For Inner-South Residents
If you own property in South Yarra, Prahran or Windsor, here’s your new reality:
Your neighbourhood is about to change, whether you like it or not. Not in 2051. Starting now. Property developers are already drawing up plans. Some will be smart, considered developments that genuinely improve the area. Others will be profit-focused boxes that make your street feel like a wind tunnel.
Single-house zoning is effectively dead in these areas. That character-filled Victorian terrace three doors down that’s been in the same family for 40 years? When it eventually sells, it’s far more likely to become a multi-unit development than stay as a single dwelling. The government announced this plan alongside a different approach for Melbourne and Yarra city councils, going “street by street, block by block” to identify under-utilised sites near public transport.
Infrastructure is going to struggle. The Property Council’s Victorian Executive Director said that while activity centres will boost housing supply, ensuring adequate infrastructure is essential, noting that schools, healthcare facilities and recreational spaces need to be introduced at the right time to accommodate accelerated population growth.
Translation: they’re building the homes first and hoping the infrastructure catches up later. Anyone who’s tried to get a GP appointment in Prahran lately knows how well that’s going to work.
Your property value might go up, but your quality of life might go down. More people means more pressure on everything from parking to your local cafe being packed every weekend morning. The trade-off used to be that inner-city living meant convenience but less space. Now it’s going to mean convenience, less space, AND more crowds.
The Developer’s Dream Scenario
From a pure business perspective, this is brilliant news for property developers. The government has essentially removed the biggest obstacle to high-density development: local council planning controls. No more community consultations that actually have teeth. No more local councillors who need to face residents at the next election.
Planning Minister Sonya Kilkenny mentioned that the 50 activity centres will be subject to community consultation, and noted the government changed its plans for 10 existing centres after this process. But let’s be realistic about what “consultation” means when the state government has already seized planning power from councils. It’s like asking for feedback on a decision that’s already been made.
What You Should Actually Do About This
I’m not one of those people who says “there’s nothing you can do, just accept it.” That’s rubbish. Here’s what residents in these areas should be doing:
Get involved in the community consultation process. Yes, I just said it’s mostly for show, but showing up and making noise is better than silence. The government did change plans for 10 centres after consultation. Make your voice one of the ones they can’t ignore.
Talk to your neighbours now. The people who organise early and present unified positions to developers and councils get heard. The people who complain individually on Facebook after construction starts get ignored.
Understand the planning controls before they’re finalised. Most people don’t read planning documents until there’s a 12-storey building going up next door. By then it’s too late. The Property Council wants special economic zones and tax concessions for these areas. That means even more development pressure.
If you’re thinking of selling, time matters. Property near proposed developments can see value spikes before construction starts, then potential dips during the building phase when your street’s a construction zone. Talk to a proper estate agent who knows the area, not just someone who wants a quick commission.
The Bigger Picture Nobody’s Talking About
When the government first announced these plans last year, they sparked a highly publicised rally in Brighton, another affluent suburb that was slated for rezoning. The opposition called it “the longest political suicide note in Victoria’s history.”
Here’s the thing though: whether this is good policy or bad policy, it’s happening. The housing crisis is real. Melbourne’s population is growing. Something has to give.
The frustrating part is that this didn’t have to be an either-or situation. There are models from other cities where they’ve managed to increase density without destroying neighbourhood character, where they’ve built infrastructure before the population surge, where they’ve worked with communities instead of against them.
But that takes time and patience and political will. This government has chosen the fast track, and residents in the inner-south are going to be the test case.
Final Thoughts
I write about marketing and business, not urban planning. But I’ve spent enough time in the property sector to know when something big is happening, even when the news makes it sound bureaucratic and boring.
The inner-south housing density push isn’t a 2051 problem. It’s a 2025 problem that’s going to define these neighbourhoods for the next generation. The blocks between South Yarra station and Windsor station, the streets around Prahran station – all of it is about to change in ways that will be irreversible.
If you live there, you’ve got choices. Get involved, stay informed, or wake up one day and wonder when your neighbourhood became unrecognisable.
One thing’s certain: by 2051, when your kids ask what the area used to look like, you’ll have stories to tell them about the before times, when you could still find a park on Chapel Street.
About Durham House: Durham House is a real estate agency serving Melbourne’s inner-south suburbs. If you’re navigating property decisions in areas affected by the activity centres program, we’re here to help with local expertise and honest advice.
