Housing was added to Member for Polwarth Richard Riordan's responsibilities in a Liberal Party reshuffle, and he said it was a big issue for regional and rural communities.

Mr Riordan fears towns could start to losing sporting clubs, CFA members and schools if nothing was done to shore up more affordable housing.

He flagged the idea of community land trusts and fast-tracking rezoning to get things moving in regional areas with both short and long-term accommodation options.

Mr Riordan said the "migration boom" from the city to regional and rural areas because of the pandemic had put pressure on coastal communities.

"The Great Ocean Road is really being held back at the moment because there is no where for staff and labour to live and work. Port Fairy definitely has that problem," he said.

"We have to be creative and think of other ways to do it because if we don't we are going to lose the heart and soul of many communities.

"We're going to lose the kinders and the schools and sports clubs and the CFA members and all those sorts of things that make communities a community."

Mr Riordan said prices had been driven up along the Great Ocean Road, not just by people coming to live there, but investors and part-time residents.

"You could almost for some of these communities call them trophy communities in a sense that they have a prestige about them," he said.

"We still need people to work in the cafes and the shops. We want people to live there. I'm very keen to explore community land trusts as an option for helping those communities. It would have to be in conjunction with local government."

A community land trust is when land is owned by a community-based, not for profit entity and the building owned by the household.

Mr Riordan said he had met with Corangamite Shire about getting access to land that was suitable for further development, and said it was a big issue.

"Local government tells me there's a whole bunch of land, particularly in our regional areas, that could be opened up much more quickly and much more cheaply," he said.

Mr Riordan said people were "sitting on" empty blocks at the edge of towns because it was too costly and there was too much "rigmarole" involved in turning them into house blocks.

He said he had been contacted by someone who was planning a 70-lot subdivision who had been hit with $800,000 in consultant fees and costs that "add zero value" to the project.

He also took a swipe at the government over a plan to tax new developments of three or more dwellings to fund social housing. The government has now appeared to back away from the plan over fears the levy would drive up the cost of housing.

"It's a huge slug, when we are talking about affordability and availability, to have that sort of impost at this time is a bit crazy," Mr Riordan said.

Mr Riordan said he feared that while that proposed legislation didn't apply to regional areas, it could eventually change down the track because the budget was "in such a pickle".

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