TWENTY-NINE new houses could appear in Macedon because of changes to the town's restructure overlay.
At last week's meeting, the council decided it would keep the policy but make changes to allow more people to build on their land if they choose.
The overlay applies to 310 hectares of land and affects about 570 residential properties, including a commercial area.
In March, the council launched a survey to gauge residents' views on abandoning the policy.
It was introduced by the state government in the 1970s to identify old and inappropriate subdivisions to be restructured and preserve and enhance the amenity of the area.
Connection to the public sewer was one of the reasons for limiting development, which no longer applies.
About 266 residents responded to the council's survey. Of them, 65 per cent said planning controls should not be simplified to make it easier to get a planning permit and 33 per cent disagreed.
At the meeting, councillors Helen Relph, Rob Guthrie and Joan Donovan declared conflicts of interest and left the room.
Cr Neil Manning objected to changing the overlay, suggesting there was a fire risk in allowing more houses to be built.
"Why would the people of Macedon push so hard for a neighbourhood safer place if they don't think the area is safe? There are fire issues that haven't been looked at."
Council planning and environment director Sophie Segafredo said planning scheme controls like minimum size lots and bushfire management overlays would still apply.
Cr John Letchford said people built in fire zones across the Macedon Ranges knowing the risks and took measures to manage them.
Councillors' comments were applauded by the public gallery.