Development Facilitation Program

The estimated development cost is a calculation of the materials and labour costs. This estimate must be supported by a report prepared by a suitably qualified quantity surveyor.

Other than for projects carried out or funded by (or on behalf of) the State of Victoria or a public authority, or for renewable energy facilities (or related utility installations), all requests must be supported by written advice from the Chief Executive Officer of Invest Victoria, confirming the project has demonstrated investment certainty or capacity to secure funding.

DTP officers will assist applicants to obtain Invest Victoria’s written advice during the DFP pre-application enquiry process.

Ineligible requests

Not all projects are eligible for the program, including:

• applications to subdivide land, except where:
  • the project includes a development component and is combined with a planning scheme amendment under section 96A of the Planning and Environment Act 1987)
  • the project includes a renewable energy facility or utility installation associated with a renewable energy facility.
• applications or consents for a use or development to which any of the following clauses apply: Clause 52.03 (Level Crossing Removal Project), Clause 52.20 (Victoria’s Big Housing Build), 52.30 (State Projects), Clause 52.31 (Local Government Projects), Clause 52.35 (Major Road Projects), Clause 52.36 (Rail Projects), Clause 53.19 (Non-Government Schools), Clause 53.20 (Housing by or on behalf of Homes Victoria), and Clause 53.21 (State Transport Projects)
• where the Minister for Planning has authorised or directed the Victorian Planning Authority to prepare or implement a plan for an identified precinct
• proposals to subdivide green wedge land into more lots or into smaller lots than allowed for by the relevant planning scheme.
• proposals for land in an Urban Growth Zone where a Precinct Structure Plan has not been prepared.

Assessment process

All projects are assessed on planning merit having regard to:

• the requirements of the Planning and Environment Act 1987 (including the objectives of planning in Victoria)
• State and local provisions of the planning scheme
• Site context, including potential amenity and environmental impacts

All projects considered by the DFP are subject to a design review process to ensure proposals deliver high-quality built form outcomes for Victoria. Design review processes are outlined within the Design Review Terms of Reference.

• Design Review Terms of Reference (PDF, 146.1 KB)

DFP planning permit applications are subject to the same referral and public notice requirements as any other permit application. DTP will consult referral authorities and local governments and notify adjoining property owners and potentially affected parties if required by the planning scheme. Authority and community views will be considered as part of DTP’s planning assessment.

Delivery of affordable housing

Government will seek that the 10% requirement for affordable housing under Clause 53.23 is delivered by one of the three options set out below.

Option 1 – Discounted sale or gifting of homes to a registered housing agency (RHA) or Homes Victoria delivery criteria

• Affordable housing can be contributed as:
• 10% of all dwellings sold at a 30% discount to a Registered Housing Agency (RHA) or Homes Victoria for operation as social and/or affordable housing, or
• 3% of dwellings gifted to a RHA or Homes Victoria.
• an alternative percentage of dwellings or alternative discount rates may be considered where the total value is equivalent to the 3% contribution in option 2.
• the applicant should provide evidence of an agreement that confirms support of the RHA.

Learn more about RHAs in Victoria.

Option 2 – Contribution to the social housing growth fund delivery criteria

• A cash contribution equal to 3% of the development cost to the Social Housing Growth Fund (SHGF).
• Payment to be made to the Department of Treasury (DTF) and Finance accounts receivable.
• The current contribution amount will be subject to review periodically.

Option 3 – Discounted rental in Build to Rent developments

• 10% of dwellings rented to eligible households in build to rent (BTR) projects over a defined period, until the affordable housing contribution has been fully acquitted.
• The total value of the contribution, to be acquitted over the defined period, must be equivalent to the 3% contribution in option 2.
• Reduced rent provided on the market rent of the dwelling must result in an affordable rental price for the eligible household (no more than 30 per cent of their household income).
• The proponent must report annually to the Minister for Planning on the rental discount provided and accrued contribution until the obligation has been met.

Supplementary information

Alternative options

Alternative options that provide a contribution equal to 3% of the development cost may be considered by the responsible authority on a case-by-case basis.

Development cost

‘Development cost’ refers to the estimated cost of development for the residential component of the proposal. The development cost should be verified by a quantity surveyor report prepared by an appropriately qualified person. The estimated development cost should be based on industry recognised prices for materials and labour costs and using an industry recognised calculation method and include GST. The report must be prepared to the satisfaction of the responsible authority and be dated no earlier than 60 days prior to the application’s submission.

Only the residential component of a mixed-use development is used for the purposes of calculating the development cost.

Section 173 agreement

The costs incurred in relation to the preparation, execution and registration of a s173 agreement for affordable housing will be met in full by the developer.

You can view examples of Section 173 agreements on the planning housing strategy section of this website.

Dwelling mix

The affordable housing dwellings delivered should generally be representative of the approved dwelling mix, unless otherwise required by an RHA and agreed by the responsible authority.

For example, if 100 dwellings were proposed comprising 50 X 1 bedroom units and 50 X 2 bedroom units, the affordable housing provision would be 5 x 1 bedroom units and 5 x 2 bedroom units.

Resources

Governance

All projects will be considered under the Planning and Environment Act 1987 including probity and confidentiality and will be subject to the same level of rigorous assessment and opportunity for consultation as per the standard assessment process.

Page last updated: 14/04/25