The proposed Rivers Run Estate would be subdivided into 75 lots, with well over 80 dwellings planned to be built, making it possibly the largest development Port Fairy has seen in decades.

The development aims to provide a range of housing options, with lots ranging from 350 to 660 square metres, as well as a handful of one- and two-bedroom townhouses.

The estate would also contain a park with picnic and cycling facilities and connections to the Port Fairy-Warrnambool Rail Trail.

Councillor Jim Doukas said he thought it was a "great application".

"Port Fairy is crying out for something like this.

"It provides 90-odd blocks not too far from the centre of town and it's on the south side of the highway so young families won't have to cross the highway to get to town.

"To date I haven't heard anybody say anything negative about it," he said.

The planning amendment that would pave the way forward for the project includes rezoning the land for housing, as well as approving a planning scheme overlay that permits the substantial 75-lot development.

Land available for housing has been in short supply throughout Moyne Shire for years, particularly in Port Fairy where house prices have shot well beyond the reach of the average family.

A council spokesman said the estate was expected to assist with the critical housing shortage.

Yet development in the small, picturesque town is also expected to raise concerns for some residents.

Cr Jordan Lockett said he would be listening closely to all feedback throughout January.

He said the sustainable and social housing features of the application were impressive, but it was always important to balance the need for new housing with the dangers of overdevelopment.

"If you slice up paradise too much it's not paradise any more," he said.

Moyne director of economic development and planning, Brett Davis, said it was critical ratepayers had all possible information about the proposal.

"We want to make sure the community has the full picture, and the opportunity to provide their input on these matters," he said.

Community members can attend a drop in session at the Port Fairy Bowls Club, on January 12 between 3pm and 7pm, or book a one-on-one appointment with a council officer at the bowls club on Wednesday January 12 between 12.30pm and 5pm.

Submissions to the proposal can be made by post or email and close on January 31.

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