Victoria has committed to building 800,000 homes in the next decade while holiday-makers will be slugged with a short-stay accommodation levy to address the state's housing crisis.
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Premier Daniel Andrews unveiled reforms as part of his government's long-waited housing statement on Wednesday.
The changes are headlined by an Australian-first 7.5 per cent consumer levy on short-term accommodation bookings with platforms such as Airbnb and Stayz.
The premier conceded the levy would not be popular with everyone but described it as a modest charge.
"Every single cent will go to Homes Victoria to build more houses and maintain houses," he told reporters.
The levy is expected to raise $70 million a year from January 1, 2025.
Under the more than 40-page housing statement, surplus government land will be rezoned to build an estimated 9000 homes across 45 sites in both metropolitan Melbourne and regional Victoria.
The government has committed to making at least 10 per cent of the homes built on those sites affordable housing.
Victoria becoming a signatory to an "affordable housing investment partnership" will also mean developers who prioritise affordable housing will have low interest loans and government guarantees.
Planning applications valued at over $50 million in Melbourne and $15 million in regional Victoria will be assessed under a development facilitation program rather than by councils, if 10 per cent is set aside as affordable housing.
The government said the change would cut down time frames from more than 12 months to four, and the planning minister would be the decision-maker for those projects.
Melbourne's 44 infamous high-rise public housing towers will be progressively redeveloped by 2051 under the housing statement, with Carlton's red brick towers the first to go.
The premier described the towers, built between the 1950s and 1970s, as crumbling and out of date.
"This is a massive agenda to reimagine those spaces," Mr Andrews said.
"These towers are currently home to 10,000 residents. By the time we are finished redeveloping every single one of these sites, they will be home to 30,000 residents and perhaps more."
Apartment design standards will also be bolstered under the scheme.
The Andrews government expects its housing statement will lead to the construction of up to 800,00 new homes in the next decade.
New analysis within the statement forecasts Victoria's population to hit 10.3 million by 2051, an increase of 3.5 million.
Eight million are expected to call Melbourne home and another 2.3 million will be based in regional Victoria, meaning 2.24 million homes must be to built statewide.
Victoria will also outlaw rent bidding by prospective tenants, increase the minimum notice to vacate time from 60 to 90 days, and ban landlords from raising rents for a year after asking the previous tenant to vacate.
A new agency will be set up to resolve disputes between landlords and tenants.
Airbnb Australia and New Zealand's public policy head Michael Crosby has previously backed a levy but suggested a 7.5 per cent rate will affect tourism and should be lower.
Stayz government and corporate affairs senior director Eacham Curry has described the levy as ill-conceived and said the sector should not be painted as the cause of or solution to Victoria's housing crisis.
Australian Associated Press
