Michael Buxton, professor of environment and planning at RMIT, said Melbourne's outer densities were among the lowest in the world.

"We have wasted 20 years on this issue, have consumed a huge amount of unnecessary land and built terrible suburbs."

Professor Buxton was commenting on a Casey Council survey of residents asking what sort of homes would suit their lifestyle.

He said spreading cities had major environmental and economic costs and created major social differences.

"This is stark in Melbourne - on the whole, lower-income people with fewer educational qualifications live on the fringe far from public transport and most jobs, while higher-income and more highly educated people live in the middle and inner ring, service-rich suburbs."

While almost half of Casey households have just one or two people, 95 per cent of Casey homes have three or more bedrooms.

Professor Buxton said developers should be looking at attached two and three-bedroom row housing or townhouses, which were now the norm on the fringes of many Canadian and US cities.

"We need to locate higher densities around town centres, make sure town centres are located on rail lines, and provide a range of densities and housing types - progressively becoming larger the further the distance from rail stations and activity centres.

"Infrastructure and facilities must be located in walking distance of each other and in or close to town centres. Through accepted planning and design techniques, high-quality outer urban living environments can be built, and the need for further outer urban expansion limited."

Professor Buxton said fears that higher-density suburbs would necessarily become the slums of the future were unfounded.

"If such planning is so bad, why are Albert Park, East Melbourne and many other traditional inner suburbs such desirable places to live? The state government and councils are so far behind the action on this that they are over the horizon."