What does the federal election mean for property, housing and investors? With so much negative noise, confusion, chaos, and political spin drowning us in the media, how can we make sense of it all so that we’re making an informed vote for the party that is going to best secure our property future?
Today I want to help you with this by giving you my best effort at a neutral, transparent, objective and apolitical view of what the parties are proposing, (given that I’m agnostic on this because it doesn’t matter who you vote for, you always end up with a politician!), as well as what the pro’s and con’s of their policies are, what impacts their policies are likely to have, and most importantly, what does it mean to you as an investor, and on balance, which party’s policies are best to vote for in order to give you better investment outcomes.
So let’s dive headfirst into one of the biggest battlegrounds of the federal election – housing affordability. And this isn’t just about politics – it’s about your future as a property investor. Now I know – there’s been a lot of noise. Flashy promises, big-dollar spending, and finger-pointing across the aisle. But what does it all really mean for you as an investor? Today, I’m going to cut through the never-ending hoo har and give you the no-nonsense breakdown.
So We’re going to unpack what the major parties are proposing and break down the housing policies proposed by the sitting Prime Minister Albo’s Australian Labor Party, the Liberal National Party Coalition under Peter Dutton, as well as the Australian Greens whose radical housing shouts for relevance need special mention. Because make no mistake, the outcome of this election and who controls political power is likely to have a meaningful impact on the future of property.
Now it’s important to emphasize that I’m only talking about Federal government approaches today, which are separate from a raft of other State Government housing initiatives that vary from state to state and are available to assist people secure a home or rental.
The Problem: Housing Affordability in Australia
First, let’s set the scene. Why is housing affordability such a mess? Well, it comes down to one thing – prices have skyrocketed way faster than wages. Over the last five years, housing values have jumped over 30%, while wages have crept up just 15%. And over two decades or more? It’s even worse. Property values have consistently outpaced income growth by about two-to-one.
Now combine that with record low listing levels and vacancy rates, rising construction costs, and a dire shortage of trades, and you’ve got a perfect storm. There’s not enough supply, demand’s off the charts, and prices in tightly held growth zones are going nowhere but up.
And a lot of this is due to the fact that governments at all levels stopped providing the safety net of housing for those most in need back in the 1970’s and 80’s, and instead, became Teflon finger pointers who have made housing solely a private sector problem, which has meant that housing supply has understandably fallen through the floor while demand continues to rise.
So it’s no surprise that housing has become the hot-button issue this election.
The Solutions: What Are the Major Parties Offering?
Alright, let’s break it down – party by party and side by side.
1. Australian Labor Party (ALP) Agenda
Housing Australia Future Fund (HAFF)
This is a $10 billion fund proposed to support the construction of 30,000 homes over five years and up to 100,000 extra new homes over the next eight years, focusing on social and affordable housing.
- Pro: Strong social housing push. Long-term affordability benefit. Boosts housing supply.
- Con: Implementation challenges. Delays or cost overruns may hinder effectiveness.
Home Guarantee Scheme Expansion
This scheme allows first-home buyers to purchase a property with as little as a 5% deposit, without the need for lenders mortgage insurance.
- Pro: Reduces the entry barrier for low-deposit buyers.
- Con: Shared equity with the government may complicate future sales or refinancing.
Social Housing Accelerator
This aims to increase social housing stock, especially for vulnerable groups.
- Pro: Addresses genuine need.
- Con: Slow rollout and limited impact on middle-market buyers or investors.
2. Liberal National Party Coalition
Infrastructure Fund
This $5 billion fund focuses on unlocking land by paying for the infrastructure needed to get developments shovel-ready.
- Pro: Reduces bottlenecks and fast-tracks increased supply.
- Con: May contribute to urban sprawl and increased long-term costs.
Super-for-Housing Scheme
This allows first-home buyers to access up to $50,000 from their super to buy a home.
- Pro: Assists in overcoming the deposit barrier for many home buyers.
- Con: Could push prices higher and increase the risk of eroding retirement savings.
Tax Deductible Mortgage Repayments
This policy allows first-home buyers of newly built homes to deduct mortgage interest payments from taxable income for the first five years.
- Pro: Reduces holding costs for first-home buyers and stimulates demand for new housing.
- Con: May increase demand and put pressure on new build prices.
APRA Reforms
Proposing changes to APRA’s lending assessment rules, particularly the mortgage serviceability buffer, to increase borrowing capacity.
- Pro: Increases borrowing capacity and provides more opportunities for portfolio growth.
- Con: Could overheat the market and lead to higher prices in tight supply areas.
3. The Australian Greens
Housing Tax Reform and Rent Controls
The Greens are proposing the phase-out of negative gearing and capital gains tax discounts, along with strong rent controls and a significant public housing development plan.
- Pro: Provides a safety net for those most in need.
- Con: Could drive property investors out of the market, reducing rental supply and worsening the affordability crisis.
Ultimately, the Greens’ approach focuses on demonizing property investors, which could inadvertently exacerbate the housing crisis.
The Implications for Investors
So what do all of these party policies mean for you as a property investor?
Let’s call it how it is: all of the parties are throwing more fuel on the demand fire, with only a few candles heading toward supply. This means one thing – prices are likely to continue to rise, not fall. Experts estimate an increase of around 5% – and that’s conservative.
So if you’re in the market, timing is key. The earlier you secure your next asset, the better.
BUT – and it’s a big but – watch the market fundamentals. Some of these policies may create short-term sugar hits, but long-term growth depends on infrastructure, rental demand, and supply pipelines.
Also, note the potential divide in who benefits:
- Coalition policies = Favour higher income earners and investors with equity.
- Labor policies = Support for entry-level buyers and renters.
If you’re a strategic investor – you’ll already be asking:
- Where are the infrastructure funds going?
- Which regions will see the most new development?
- Where will demand spill over due to constrained supply?
This is the kind of intel that separates the speculative buyers from the professionals.
The Deeper Dive: Should Negative Gearing be on the Table?
Now, let’s touch briefly on the third rail – negative gearing.
Right now, about 42% of investors claim a loss on their rental properties. That number’s only going up as interest rates rise. If either party winds back negative gearing, expect fewer rental investors and an even tighter rental market – pushing rents even higher.
Yes, that could lower prices. But it also means less supply, more renters struggling, and fewer investors willing to shoulder the load of our rental housing system – which, by the way, is almost 90% funded by mum-and-dad investors like many of you listening right now.
So tread carefully. A price drop may sound appealing, but it could have knock-on effects that make the whole ecosystem shakier – especially if you’re relying on yield.
The election 2025 verdict for property investors
Well, it’s like choosing the least worst option. All parties have good intentions. All parties offer some decent long-term solutions. But none of them has nailed the execution when it comes to solving affordability and supporting sustainable investment.
Be careful about your second preferences, as we don’t want a hung parliament with the balance of power relying on compromise relationships without a mandate, where a minority party or independent gets to decide our future and force policy changes that may help their self-interested squeaky wheel agendas but cause immediate and long-term harm for the silent majority of great hard-working Aussies.
So here’s the Bushy bottom line:
- Focus on fundamentals, not headlines.
- Watch infrastructure spending and supply zones.
- Time your entries with care – don’t chase the sugar hits.
- And most importantly – invest with a 20-year horizon, not a 2-year cycle.
Remember, property is a game of finance, not real estate. Your ability to borrow and hold for the long-term will matter more than any election policy ever will.
That’s it for today. If you found this valuable, share it with your mates, drop us a review, and let’s keep helping Australians take control of their financial future.
