The warning coincides with a surge of development applications in at least 11 Canberra suburbs, where developers are proposing to demolish homes to make way for clusters of five, 10 and up to 31 units.

While the ACT Planning and Land Authority will reject over-scaled or poor quality designs, it's also preparing discussion papers on increasing housing density in certain precincts.

''Because there is no question, Canberra can't continue to just expand at the edges,'' Mr Savery said.

Under proposed new change-of-use fees, developers could pay up to $70,000 a unit or more for redevelopment of infill sites, which has sent some into a panic, prompting new applications to avoid the rise.

In one proposal opposite Griffith shops in Stuart Street, five brick and tile homes will be demolished to make way for 31, one-bedroom and two-bedroom units. While declining to comment on the application, the proponent says this application was not triggered by the looming fee increase.

Two homes will be demolished in Cook for 10 town houses. In Deakin, two homes will be demolished for five town houses and basement garage and in Dickson, two homes will go to make way for 12 units.

Similar developments are proposed at Holder, O'Connor, Pearce, Turner, Wanniassa and Yarralumla. At Narrabundah, a church and two residences will be demolished to make way for 23 new units.

An architect awaiting planning approval said people had panicked thinking they would not make enough money to justify a redevelopment under the new fees structure.

ACT Treasurer Katy Gallagher sought to calm a property industry lunch gathering last week, saying the Government would not introduce a system that would stifle or stop development. She said a final report on codification of the fees was almost complete.

Controversy surrounding the proposed Hawker redevelopment and Brumbies' proposal for redeveloping Griffith Oval showed how hard urban infill was to achieve.

For more, pick up a copy of today's Canberra Times