Bendigo's housing crisis demands bold intervention, officials and planners warn

Bendigo's acute housing shortage has sparked an urgent policy debate among officials and urban planning experts, with stakeholders calling for sweeping changes to zoning laws and development incentives to unlock thousands of new dwellings across the city.

The Bendigo City Council is under mounting pressure to fast-track approvals in key growth corridors, particularly around Kangaroo Flat and the northern suburbs, where median house prices have climbed past $650,000 over the past 18 months. Rental vacancy rates have fallen below 1 per cent, according to local property data, leaving thousands of residents competing for scarce accommodation.

Speaking at last week's planning forum hosted by the Bendigo Chamber of Commerce, senior council planners outlined a draft framework to increase housing density along major transport routes, particularly around the Bendigo train station precinct and along the Mitchell Highway corridor. The proposal includes relaxed parking requirements for apartment buildings and expedited development assessment for mixed-use projects that incorporate affordable rental units.

"We need to fundamentally rethink how we use land in Bendigo's CBD and inner suburbs," said one planning authority representative, emphasising that traditional low-density zoning was no longer tenable given population growth projections showing the city could reach 200,000 residents by 2036.

However, heritage advocates and neighbourhood groups have cautioned against overdevelopment. The Golden Dragon Museum precinct and surrounding heritage conservation zones have become flashpoints, with some residents expressing concern that rapid infill development could erode Bendigo's character.

Architectural firms and developers briefed on the proposals have flagged another obstacle: construction costs and labour shortages are making it difficult to deliver truly affordable housing without substantial government subsidies. Industry representatives have called for tax breaks and expedited approvals to incentivise projects targeting renters earning under $70,000 annually.

The Victorian Affordable Housing Alliance, which has been monitoring Bendigo's rental crisis, has urged the council to mandate that 15 per cent of all new residential developments include long-term affordable units. Officials have indicated this threshold may be negotiable, but have not ruled it out entirely.

The debate reflects broader tensions facing regional cities nationwide: accommodating growth while preserving community identity and ensuring housing remains accessible to workers in essential services. A final housing policy framework is expected by August, with implementation beginning in early 2027.

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