SKY-HIGH PROMISES, GROUND-LEVEL REALITY: MELBOURNE’S TOWER BOOM FACES A RECKONING

Melbourne’s push to flood established suburbs with high-rise apartments is running headlong into a problem no planning map can wish away: the numbers are not stacking up.

Across 60 designated activity hubs, zoning changes now permit towers up to 20 storeys and beyond near major transport investments. On paper, the housing yield is immense. Capacity runs into the hundreds of thousands of dwellings.

In reality, only a fraction of those homes are commercially viable under current conditions. Construction costs have surged dramatically in recent years, finance remains tight and demand for new apartments in some middle and outer suburban centres is uneven. In parts of the inner south-east, existing apartments are selling at losses, raising doubts about whether buyers will pay premiums for newly built high-density stock.

While permits are flowing, cranes are not. Thousands of approved projects remain unbuilt.

Planning Minister Sonya Kilkenny has been accused by critics of approving almost anything placed before her in order to front press conferences declaring progress on the housing crisis. Yet approvals alone do not deliver homes. Councils and local communities argue they are increasingly sidelined, with consultation reduced and objections brushed aside in the race to meet targets.

Now, with mounting evidence that many approved developments are stalled, calls are emerging for state-backed subsidies, tax waivers and financial incentives to “kickstart” construction. Framed as a housing emergency, such measures could pave the way for density at all costs.

The likely trade-off is clear: smaller apartments, reduced amenity, diminished open space and compromised building standards. The risk is that in the rush to build faster, Melbourne lowers its living standards just as rapidly.