The Urban Development Institute of Australia president Nick Allingame said the move would provide more affordable housing options in existing and new suburbs with R80 zoning.
"Micro lots are just one option that is being pursued in order to provide quality housing at an entry level price to suit first home buyers,empty nesters,downsizers and investors,"he said.
"The new guidelines will hopefully facilitate a broader roll out of these lot types in more areas."
Home buyers in other states such as Queensland and South Australia have already jumped on the micro-lot initiative with some purchasing blocks as small as 45 square metres.
Cottage blocks lots between 100 and 200 square metres are already being built in Perth's outer suburbs.
A trial of 80-square-metre micro-lots in Ellenbrook's town centre has also been successful,prompting the state government to announce its policy position to shrink the size of WA's minimum block.