While NSW and Victoria had started addressing the issue, Australia would still miss its 1.2 million new dwelling target over the next five years unless more was done, he said.
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“These changes need to allow for greater density and height near good transport services, while at the same time protecting the quality of life, green space and heritage of an area,” Black said.
“Put simply, we need to build enough homes where people want to live, so until we fix that problem, it will be very hard to hit our housing targets.
“Building a home in the right place is as important as building it at all.”
The Allan government, which was briefed on the report before its release, said Victoria continued to build and approve thousands more homes when compared to other states.
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“Areas with good transport connections shouldn’t be locked up, they should be opened up – that’s exactly why we’ve introduced draft housing targets for council areas and have announced ten activity centres,” a spokesperson said.
“We’re not going to slow down and over the coming weeks, we’re going to outline new key policy changes to build even more homes.”
The Business Council also highlighted reforms in South Australia, where the state government consolidated dozens of planning rules into one single code. Black said that had made a “big difference” when it came to home builders getting projects off the ground.
But Dr Stephen Glackin, a senior research fellow at Swinburne University’s Centre for Urban Transitions, warned against simple zoning changes to drive up density, saying suburbs also need mixed-use functions to be more liveable.
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“The 10 activity centres already have a high a level of amenity as they are set up well for high density living,” Glackin said.
“Rezoning other areas to increase density is great in terms of housing outcomes, but you will need to make these areas more liveable.
“If there is going to be re-zoning more broadly it will need to include mixed use, so there are shops and services available within walking distance.”
In recent weeks, the state opposition has held a series of meetings with residents living near activity centres, vowing to oppose any attempt to remove third-party rights in the planning process and any attempt by Labor to remove heritage protections.
The report comes days after the business lobby called on the state government to strip planning powers from councils that fall behind on approving planning permits.
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