I didn't think to check before, but Essendon is listed in the Airports Regulations and therefore its use and sale is covered by the Airports Act, which includes the following requirement;
s(11) (c) the lease must provide for access by interstate and/or international air transport;.
So presumably any change of use would have to be done by amendment to the Act and a change of lessee. That's not to say that closing Essendon or any other listed airport is impossible, but it's a lot harder than the 'owners' sticking a housing development application in, because they're really just tenants on Crown land that is proscribed by legislation as being for an airport.
If (God forbid) the Watermelon Party ever run the country in their own right I suppose it could happen, but if that happens we'll probably all be living in caves anway. My hope is that the general population will be so sick of their crap by the next election that they'll dissappear back into the swamp they crawled out of.