Zones and overlays

When it comes to property development in Victoria, zones and overlays are two of the most important factors in determining what you can and can’t do with your land. They dictate whether a site is developable, how many dwellings it might accommodate, and what special conditions must be met before council will grant approval.

Using Tools to Research Zones and Overlays

One of the easiest ways to research planning controls on a property is through Landchecker. This website allows you to:

• Search a specific site to see its planning zone and whether overlays apply

• View a colour-coded map that highlights different zones and overlays across an area

• Browse broader neighbourhoods to quickly identify sites with preferred zoning, such as RGZ or ACZ

While there are also government portals like Land Vic, Landchecker is especially popular with developers and designers because of its user-friendly interface and visual mapping.

What Are Planning Zones?

Every parcel of land in Victoria is covered by a planning zone, which determines how that land can be used and what is prohibited. Zones are not site-specific but blanket whole areas, meaning that multiple properties in the same street may share the same zoning.

However, the boundaries are strict. A property on one side of the road may be zoned differently from its neighbour, with different development allowances and restrictions.

Key point: You cannot assume that what’s possible on a nearby property will be possible on yours. Zoning changes over time, and planning rules may have tightened since other developments were approved.

An example of a zone change between different sites and across the road

Common Residential Zones

General Residential Zone (GRZ)

The GRZ is the most common residential zone, covering the majority of suburban areas. Development is possible, but generally requires:

• Approx. 300–400 sqm per dwelling (depending on site specifics)

• Compliance with minimum setbacks, private open space, and site coverage limits

A major change occurred in 2017, when a minimum garden area requirement was introduced for GRZ and NRZ sites. Between 25–35% of the land (depending on lot size) must be free of buildings and driveways. This restriction has had a huge impact on yields in recent years, as much larger sites are now required to achieve viable outcomes.

More on the minimum garden area requirement (Planning Practice Note 84).

Neighbourhood Residential Zone (NRZ)

The NRZ is the most restrictive of the residential zones. Councils apply this zoning in areas where they want to preserve existing neighbourhood character, typically low-density areas with significant greenery or large lot sizes.

While development isn’t impossible, NRZ sites:

• Must comply with the garden area requirement

• Require very large lots per dwelling to satisfy open space and separation standards

• Are often met with resistance from council when medium-density proposals are lodged

Residential Growth Zone (RGZ)

The RGZ is one of the more favourable residential zone for developers. These areas are earmarked by council for infill development and higher densities. Benefits include:

• No minimum garden area requirement

• Greater council support for development proposals

• Higher yield potential compared to GRZ and NRZ

RGZ areas are usually located near activity centres, shopping hubs, and public transport corridors — places where higher density is considered more sustainable. Because of their potential, RGZ sites are highly sought after and often command higher prices. Tools like Landchecker are especially useful for pinpointing exactly where these pockets are located.

Other Zones

While GRZ, NRZ, and RGZ are the most common, there are other zones relevant to development, such as:

• Activity Centre Zone (ACZ): Supports mixed-use and higher-density housing near major centres.

• Mixed Use Zone (MUZ): Allows for a blend of residential, commercial, and sometimes light industrial.

• Comprehensive Development Zone (CDZ): Applied to larger precincts earmarked for master-planned development.

Each comes with its own set of guidelines and opportunities.

What Are Overlays?

If zones determine the broad use of land, overlays apply an additional layer of rules that can significantly impact what you can build. Unlike zones, overlays are site-specific and can vary from one property to the next.

Some common overlays include:

• Heritage Overlay (HO): Protects heritage buildings, streetscapes, or precincts. Even minor works may require a planning permit.

• Vegetation Protection Overlay (VPO): Restricts removal of significant trees or vegetation.

• Land Subject to Inundation Overlay (LSIO): Requires flood risk assessments and may limit building envelopes.

• Bushfire Management Overlay (BMO): Enforces bushfire safety measures such as defendable space and construction standards.

• Environmental Significance Overlay (ESO): Protects biodiversity, waterways, and sensitive ecological areas.

Overlays can range from a mild inconvenience (such as submitting additional reports) to a major roadblock that makes development unfeasible. Importantly, the more overlays a site has, the harder and more expensive development becomes.

Final Thoughts

Understanding zones and overlays is critical before purchasing or developing a site in Victoria. A property that looks perfect on paper can quickly become financially unviable once planning restrictions are factored in.

Doing thorough research up front, using tools like Landchecker, and seeking professional advice can save you from costly mistakes. Regulations change frequently, and councils are generally tightening controls over time — meaning past developments are not always a reliable guide for what’s possible today.

At Ikonik Design, we specialise in navigating these complexities to help you assess site potential and make informed decisions before you commit.

If you’re considering a site and want to know what’s really possible, get in touch with us to arrange a feasibility review.