Revealed: Vic gov’s huge property portfolio amid housing crisis

Victorian Premier Jacinta Allan’s government is preparing to sell more than $50m worth of surplus land, but has been holding some of the sites for years. Right picture: NewsWire/David Crosling.

The Victorian government is sitting on a more than $50m property portfolio including homes it’s been planning to sell for up to eight years as it grapples with a budget crisis.

Industry figures have urged the government to urgently offload the addresses to help fund social and affordable housing, infrastructure and programs to fast-track housing approvals.

The Jacinta Allan-led government has also come under fire for the length of time it is taking to prepare the sites for sale.

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And with the government’s budget documents showing Victoria’s debt is expected to balloon to $155.5bn this year, offloading the properties could also help its balance sheet.

More than 40 homes earmarked for sale are left over after being acquired in Carnegie, Murrumbeena and Hughesdale between 2016 and 2018, for the Caulfield-Dandenong sky rail project.

Digital estimates indicate the homes’ values vary from $382,000 for a one-bedroom unit in Carnegie to a six-bedroom house in the same suburb worth $2.12m.

While the addresses were declared surplus to the government’s needs many have not been sitting empty, with some rented out to tenants.

The Victorian government bought this three-bedroom house in Carnegie for $1.75m in 2017. Its current estimated value is $1.89m, according to realestate.com.au.

And this Hughesdale home, purchased by the government for $1.82m in 2017, is now estimated to be worth about $1.79m.

Other sites among the 60-plus properties designated for sale include vacant land, an ex-police station and former schools including two which closed in 2008.

An ex-school in Broadmeadows has been on the to-be-sold list since at least 2017.

Valuations for the residential sites are available from sources external to the government such as realestate.com.au, indicate there is at least $56m in property that could be sold.

Estimates for commercial sites and other locations are not available, suggesting the real figure could be substantially higher.

A Department of Transport and Planning spokesperson said the valuations were not available because they were commercial in confidence.

In 2018, the government paid $1.9m for this four-bedroom Carnegie that’s now valued at about $2.02m, based on realestate.com.au estimates.

The Property Council’s Victorian executive director Cath Evans says funds from selling government surplus land could be reinvested into local infrastructure delivery or programs that help cut red tape and fast-track housing approvals. Picture: Jake Nowakowski.

A six-bedroom house in Carnegie, purchased by the state government for $1.875m eight years ago, which is now worth an estimated $2.12m.

The Property Council’s Victorian executive director Cath Evans said well-located, strategic sites should not sit idle when Victoria was facing a housing crisis.

“Funds from these sales could be reinvested into local infrastructure delivery or programs that help cut red tape and fast-track housing approvals,” Ms Evans said.

She said the proceeds could also support social and affordable housing projects with the state government aiming to build 800,000 new homes across the next decade.

Ms Evans added several years was more than enough time to work through planning and consultation processes, particularly when sites were already in the government’s pipeline.

“With rising debt and interest repayments, it’s more important than ever for the state to use its balance sheet wisely,” she said.

The former Laverton Police station, photographed when it was still operational in 2009, which the state government is now preparing to sell.

Real Estate Institute of Victoria interim chief executive Jacob Caine says eight years is an “extraordinarily long time” for the government to take to prepare land for sale.

The state government sold this warehouse at 2-6 Sperry Drive, Tullamarine, for $6.8m in August 2025.

Real Estate Institute of Victoria interim chief executive Jacob Caine said more needed to be done to shorten timelines for sales so “we can effectively use the properties and land that we have at our disposal today, rather than decades hence”.

“In the midst of perhaps the most acute housing affordability crisis that the state and the country’s ever faced, we need every single bit of land, property and home available to the community in order to help ease the pressures that buyers and renters across Victoria are facing,” Mr Caine said.

Surplus land sales sometimes cannot take place until a contaminated site is remediated or rezoned, which involves town planning activities and public consultation.

The land is also offered at a discount to local councils to purchase for community use, before being listed for public sale.

The government bought this Carnegie house for $1m, in 2016. Its current estimated value is $1.29m.

The ex-police station at 64 Burwood Highway, Burwood, fetched $3.125m when the government sold it in 2023.

Currently, the state government has seven sites on the market with vacant blocks in Epping, Drysdale and Melton among them.

Since January 2023, the government’s coffers have been boosted by a combined $35m in Victorian land sales.

A government spokesperson said proceeds from land sales were reinvested into services and infrastructure such as schools, hospitals and public transport.

This Murrumbeena house, with a current estimated value of $1.26m, was purchased by the Victorian government for $1.1m in 2017.

“We’re unlocking surplus government land across the state to deliver hundreds of new homes,” they said.

In March, the Minister for Housing and Building Harriet Shing announced an ex-VicRoads site in Kew had been rezoned with the aim of building up to 500 homes there including a minimum 10 per cent affordable housing component.

The government has also earmarked six other surplus sites to potentially deliver up to 350 new homes across Baxter, Bendigo, Carlton, Croydon South, Heidelberg West and Geelong.

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