“Another hurdle”: How will Yarra Ranges’ proposed erosion overlays impact the housing market?

A local real estate agent has warned the proposed expansion of Yarra Ranges Council’s erosion risk zones could strain homebuyers and builders, as the region grapples with how to protect residents from the ongoing impact of changing weather and climate.

❓What’s happening: In late June, Yarra Ranges Council received authorisation to prepare the amendment to the council’s Planning Scheme. Finalised and released to the public in August, the proposed changes to the Erosion Management Overlay mapping would mean an additional 2,365 homes would be placed in the risk zones.

⛰️What is an EMO? If your property falls under an EMO, you must get a geotechnical report before doing any building or earthworks. These reports usually cost between $700 and $3,000+.

Submissions on the proposed amendment close Sunday, October 26.

Catching up: The first documented landslides on the Dandenong Ranges were in the 1860s, with major landslips like the 1891 Montrose event involving 30,000 cubic metres of earth and rock rushing down the hill at speeds of up to 40 kilometres per hour.

• New modelling carried out as part of the latest amendment process increased the recorded number of all known landslides within the Yarra Ranges from 167 to more than 1,100.

• A July report from the council found the chance of landslides “likely and imminent”.

😵‍💫Obstacles in the way: With almost 40 years of experience in real estate in the Dandenong Ranges, Bell Real Estate managing director, Trevor Bell, said the proposed EMOs “belied belief” and were yet another hurdle for people to overcome to build on their land.

• A 2025 study by the Housing Industry Association found that red tape and taxes accounted for 43 percent of the total cost of building a new house in Melbourne.

• “By the time they finish the process, they’re so emotionally broken that a lot of them don’t proceed to build,” Bell told the Eastern Melburnian.

📉📈Supply falling, demand rising: Bell said the new restrictions could detract from the value of the affected properties, thus cutting supply and driving down demand.

• “It cuts down the appetite to live in these high-risk areas,” said Bell.

⚖️Finding a balance: University of Technology Sydney Associate Professor of Property Economics, Song Shi, told the Eastern Melburnian the impacts on property values brought on by additional costs would be “undoubtedly negative” and would “deter potential buyers”.

• “My initial hypothesis…is that the local property market will first depress, then partially recover over time assuming no further bad news (e.g., landslide events) occur in the area,” said Shi.

🥵 The forecast: Many things can increase the risk of landslides, including erratic storm conditions, bushfires, land clearing, construction.

🌧️🌅Inconsistent weather: The CSIRO’S 2024 State of the Climate report highlighted rising temperatures and altered rainfall contributing to harsher weather in Victoria.

• Environment Victoria reports global warming – and humanity’s dependence on fossil fuels – directly causes an increase in the amount of carbon dioxide and methane trapped in the Earth’s atmosphere. This causes higher temperature and more extreme weather.

What’s coming? The impacts of the changing climate on Australia’s housing market are already being felt.

• Earlier this year, the ABC reported on a husband and wife who discovered a piece of land they had purchased in Loch Sport was essentially worthless after it was placed within the Victorian Floodplain Management Strategy. 

• Dramatic photos of houses crumbling away during a landslide in McCrae, on the Mornington Peninsula, made headlines in January, leading to Mornington Peninsula Council proposing changes to EMO controls.

• Data from the Climate Council and PropTrack, released this month, found ongoing flooding has devalued Australian homes by $42 billion over two decades.