Speculation and Resistance: Constraints on Compact City Policy Implementation in Melbourne

Compact city policies such as Melbourne 2030 have been established in Australia for a range of reasons including climate change. It is now clear that the Melbourne 2030 policy has not been effective—with new development mostly on the urban fringe. This policy failure has often been sheeted home to resident and local government resistance to densification. This article suggests this narrative is insufficient to explain this failure at a metropolitan-wide scale and is clearly mistaken in one suburb, where aspects of the planning system appear to thwart the aims of strategic policy by encouraging speculation and producing vacant sites. Brunswick is an inner-city suburb with good opportunities for intensification adjacent to transit lines and on former industrial sites. In spite of resident resistance, 80 per cent of new dwellings proposed between 2002 and 2007 were approved for construction, and would have increased housing stock by 13 per cent. However, by 2009 just under half of all approved dwellings had been completed or commenced on site, while construction of the taller and higher density projects tended to stall, the sites having been on-sold and permits extended. We suggest developers anticipate that the planning system will ultimately approve significant increases in height and density, using Melbourne 2030 to over-ride local policy via appeals to the Planning Tribunal. Such permits produce significant capital gains that can be cashed without construction. We argue that elements of the Victorian planning system encourage ambit claims, contestation, cynicism and speculation, thwarting negotiations between residents, councils and developers towards a more compact city. The focus on the idea that resident resistance is the problem obscures the role the planning system itself plays in frustrating the goals of compact city policy.