Making Room: Lessons for Victoria’s Granny Flat Reforms

by Matthew Maltman

Reforms from the Victorian Government are opening doors to increase secondary dwelling construction (e.g. granny flats). New research from the e61 Institute projects the impact of these reforms by analysing a similar policy implemented in Sydney in 2009.

Secondary dwellings surged after the Sydney reform, contributing 1.5% of Sydney’s total housing supply growth and was 6.1% of detached housing growth over the past 15 years. Construction was greatest in areas with more unoccupied land space and larger households, located primarily in Sydney’s western suburbs – including in Bankstown, Fairfield, and Merrylands.

Applied to Melbourne, this experience indicates that the reforms may boost housing supply by over half a percent. We project that takeup may be highest in some outer suburbs (such as Tullamarine and Casey) and some inner suburbs (like Essendon and Coburg).

Related articles