It could soon be easier, quicker and cheaper to add a second home to your block of land with the state government announcing a review of subdivision planning processes.

The review will examine how planning can be streamlined enabling people to add a second home, build two new homes or subdivide a block into two lots

Options on the table include faster 10-day subdivisions (down from 60 days and often longer), criteria-based planning permit exemptions, or no requirement for a planning permit at all.

As part of the review, the Department of Transport and Planning will look at how approvals can be fast-tracked while maintaining standards.

According to the government, clear limits will remain in place when it comes to things like trees and car parks, and overlays permit requirements (such as in flood or heritage overlays) will still apply

The government will consult with industry – and consider final options with the aim of implementing the reforms by April next year.

KR Peters director Peter Nicolls welcomed the announcement but said the government needs to release a checklist of compulsory requirements to ensure people can't "build anything they want, willy-nilly".

"They need to come out with a regulation checklist including things like set backs from boundaries, overshadowing and landscaping."

Mr Nicolls said there was a strong appetite for easier, quicker subdivisions but he questioned whether the reform would free up land in established suburbs as claimed by the government.

"A lot of people want to do this, however there are people, including many new arrivals, who prefer to build their mansion home and occupy the whole block," he explained.

"And they are selling these homes for phenomenal prices. They want bigger blocks to build big houses and therefore represent direct competition in being able to secure land."

Mr Nicolls said anyone wanting to take advantage of streamlined subdivision regulations will have to "really research the property to make sure that at site complies with all regulations."

He also warned that even if the permit process is sped up, developers or home owners then face the same issues currently plaguing the industry - overstretched authorities, a shortage of skilled labour and high interest rates.

"Staff at the different authorities are not coping and taking months to respond. Ten years ago you could build a house in 16 weeks. Now you need 12 months."

In making the announcement, Premier Jacinta Allan said the reform will speed up the delivery of more townhouses and make Melbourne the "townhouse capital" of the nation.

Mr Nicolls said a well-built townhouse could be a good options for downsizers or those wanting to get on the property ladder, because the price point was more competitive than for a conventional single dwelling.

However, he warned townhouse developers were aiming for the luxury end of the market and there is no such thing as "affordable housing".

In 2003 the government changed regulations allowing homeowners to build small second homes, such as granny flats, without a planning permit.

For more advice on subdividing and other real estate matters contact the team at KR Real Estate at Officer 5943 1111 or Wantirna South 9800 0000.