Riverside Estate will have 1500 residential lots about 3km south of the town centre and with housing expectations topping 4000 residents is the biggest development undertaken in the area in more than 20 years.

Ballarat-based developers The Gull Group purchased 141 hectares of former farmland two years ago with a view to establishing the housing estate bordering the Werribee River and after approval by Moorabool Shire Council, Victorian planning

minister Justin Madden fast-tracked its re-zoning as residential land last week to satisfy a high demand in the area.

Moorabool Mayor Michael Tudball described the development as a "fantastic project".

"This is the single biggest development we have had in our history, more than 3500 people will live there ultimately, which shows great confidence in Bacchus Marsh," he said.

He said the project further enhanced the already robust Bacchus Marsh property market, with many prospective homeowners opting to make the move west when priced out of the Melbourne market.