Gauging Housing Pol(l)icy at the 2025 Federal Election

Kirsten Ceddia, Rahul Krishna and Andrew Steele
02 May 2025
5 minutes

Housing policy is one of the defining issues of the 2025 Federal Election, shaping debates and influencing voter priorities across the nation. While much of the conversation has focused on the challenges faced by first home buyers – rising prices, affordability, and accessibility – there's another side to the story that deserves attention.

This analysis shifts the focus to the often-overlooked stakeholders: real estate developers, property investors, community housing providers and the construction industry stakeholders. In collaboration with Local and State Government, these groups play a pivotal role in the housing ecosystem, driving supply, innovation, and economic growth.

This article provides a comparative analysis of the key policies put forward by some of the parties at this Federal Election, highlighting the implications for key stakeholders in the real estate sector.

Government-assisted housing supply

  • ALP: The Australian Labor Party (ALP) plans to alleviate the housing crisis through its commitment to build 100,000 homes for first home buyers over eight years. The homes will be constructed in collaboration with state developers, potentially offering significant advantages to developers and key construction industry stakeholders, including builders, contractors, and suppliers. The ALP has also pledged substantial funding for the construction of new homes, providing developers with increased confidence and stability when undertaking projects supported by government financial aid. In addition, the ALP has pledged to continue expanding social and affordable housing through the Housing Australia Future Fund (HAFF) if re-elected – a program the Coalition has vowed to abolish.

  • Coalition: The Coalition has committed to investing $5 billion in infrastructure projects (such as roads, public transport, and community facilities) to enhance the capacity of select suburban areas in metropolitan cities to support higher-density housing. This is designed to improve accessibility and liveability in these regions as well as provide opportunities for stakeholders within the construction, retail and manufacturing sectors.

    While the ALP and Coalition's policies aim to increase housing supply, the Coalition's policies largely rely on the initiative and interest of investors and developers, whereas the ALP's approach emphasises direct government involvement and support to drive housing supply growth. 

  • Greens: The Greens have promised the establishment of a Government-owned developer which would build affordable homes for both sale and rental purposes. This initiative seeks to offer rental properties with rents capped at levels aligned with average household incomes, while also selling a portion of homes at prices slightly above construction costs. We anticipate that the introduction of a Government-owned developer could heighten competition for land and skilled labour in the construction industry.

Regulatory reform and tax incentives

  • ALP: The ALP has announced that it will continue to back Build-to-Rent (BTR) developments with tax incentives on offer for developers. The BTR tax incentives give investors in eligible BTR developments access to an accelerated deduction of 4% for capital works relating to BTR developments and a concessional final withholding tax rate of 15%. These tax models have had success in other developed countries, with developers eager to build these projects. The ALP has also announced that it intends to speed up housing construction by investing ($54m) in the manufacturing of prefabricated and modular homes while also incentivising states to reduce red-tape in housing development. This may deliver significant advantages to developers and stakeholders within the modular housing sector.

  • Coalition: The Coalition has announced tax incentives for first home buyers on mortgage repayments. We expect this will indirectly improve financial viability of housing projects by increasing overall affordability in the market. Additionally, the Coalition seeks to incentivise developers by de-regulating the housing and construction sectors. The Coalition intends to do this by committing to a ten-year freeze on the National Construction Code. It also plans to implement measures to address alleged corruption within construction industry unions through the re-establishment of the Australian Building and Construction Commission (ABCC). These initiatives aim to reduce construction costs and strengthen investor confidence.

  • Greens: The Greens have campaigned on a platform that targets regulatory reform in the rental space, promising to create a National Renters Protection Authority and introducing rental caps to provide affordable rentals. Simultaneously, the Greens have promised to abolish negative gearing and the capital gains tax discount. It is said that the combined effect of rental regulations and the removal of investment tax incentives in the housing space may deter property investors, including larger-scale and institutional investors.

Foreign investment

ALP & Coalition: Both parties have committed to limiting migration and temporarily prohibiting foreign investors, including foreign-owned companies, from purchasing existing residential properties for a minimum of two years. These policies build upon discussions initiated by the Coalition regarding migration and its impact on increasing housing demand during the current government's term. While reducing migration may lower demand for new housing projects, this could also adversely affect developers focusing on student accommodation, as migrant student numbers are likely to be the first impacted by these measures.

Conclusion

Political parties have introduced policies to address housing supply and accelerate home construction. The ALP emphasises a more active Government role in building homes, encouraging developers to adopt innovative models for affordable housing projects – balancing higher risks with potential rewards for investors and developers. In contrast, the Coalition focuses on empowering the private sector to expand housing supply by reducing barriers for ongoing projects and offering certainty to investors and developers.

A brief comparison of the policies is set out below.

Labor
Coalition
Greens

Housing supply

Build to Rent

Property developers can access tax incentives to build apartments with a portion of units rented "affordably" below market rate. Apprentice incentive payments Payments up to $10,000 would be made to apprentices in priority areas, including construction, who complete their first year of training.

Housing Australia Future Fund

A $10 billion program to build 30,000 social and affordable homes would continue to be rolled out over the next term of parliament

Building more homes

$5 billion infrastructure investment; unlocking 500,000 homes.

Abolish HAFF

Abolition of the $10 billion Housing Australia Future Fund, which was established to fund the development of 30,000 social and affordable homes.

Building more homes

Committed to building 610,000 affordable homes over 10 years.

Creating a government-owned developer

The government-owned developer will build homes to buy and rent at affordable prices.

Foreign Investment

Foreign Investment Ban

Foreign buyers would be temporarily banned from buying existing homes for two years.

Foreign Investment Ban

Two year ban on foreign investors purchasing existing homes.

First Home Buyers

100,000 homes for first home buyers

Labor has committed $10 billion to build 100,000 homes over eight years, exclusively for purchase by first home buyers. They would be built in partnership with state developers.

5% deposits

Income limits under the First Home Buyers Guarantee would be abolished, allowing any first home buyer to purchase a home with a 5 per cent deposit without having to pay Lenders Mortgage Insurance, and eligible property prices lifted. 

Help to Buy Scheme Eligibility to use the Help to Buy scheme, where the government covers up to 40 per cent of a home's cost that first home buyers can buy out at a later date, would be expanded.

Tax offsets for first home buyers

Introduces a tax offset for first home buyers to assist with the costs of purchasing a home.

Access to Super

Superannuation access; reduced lending buffers.

5% deposits

Expansion of who can access the Home Guarantee Scheme, which allows people to buy a home with a 5 per cent deposit without facing a lenders insurance penalty. Income caps would be lifted and eligible property caps increased.

Tax deductions on mortgage interest payments

First home buyers will be able to claim mortgage interest payments on their taxes for new build homes. Interest paid on the first $650,000 of a mortgage would be deducted from a person's assessable income

Fairer mortgages

Regulating the banking sector to deliver fairer mortgages at lower rates to home buyers.

Migration

Maintains current migration levels.

Reduces migration intake by 25%

A reduction in net migration by 100,000 people from its current forecast of 260,000, including by cutting international student levels.

Regulatory Reform

Commitments to Housing Australia Future Fund to be enshrined into legislation

Labor plans to enshrine the promises made in respect of the Housing Australia Future Fund by guaranteeing in legislation a minimum disbursement of $500 million from the fund starting in the 2024-25 financial year. This amount will be indexed from 2029 and may be increased at any time through a legislative instrument.

Freezes National Construction Code changes

Changes to the National Construction Code would be frozen for ten years, which the Coalition says would provide investors more certainty.

Reinstates ABCC

ABCC, which operated between 2005 and mid-2012 and oversaw industrial relations practices to an effort to increase productivity.

Rent Control and Assistance

Aim to control rent by allowing a max 2% increase every 2 years. Create a National Renters Protection Authority to enforce renters' rights.

Tax reforms

End negative gearing and other tax breaks for investment properties.

Disclaimer
Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.