Pre-Election First Homebuyer Promises - 5% Deposit for All Vs Deduct Mortgage Payments from Income Taxes

Gdsamp on 13/04/2025 - 12:28
Last edited 13/04/2025 - 13:08

New First Homebuyer policies to be announced as campaigns for the two majors launch today

ALP
A re-elected Albanese government would allow all Australian first home buyers to purchase with a 5 per cent deposit, avoiding lenders mortgage insurance, in an expansion of an existing scheme. The proposed expansion of an existing, income-capped program would instead be made universally available for a wider range of homes by a re-elected Albanese government.
Labor proposes to let all first home buyers purchase with 5 per cent deposit

LNP
First time buyers of newly built homes would be able to deduct mortgage payments from income taxes under a Coalition government.
In what would be a controversial but historic structural change to the nation's tax system, the policy would mean a family on average incomes would be about $11,000 a year better off — or $55,000 over five years.
Coalition to unveil plan to let first home buyers deduct mortgage payments from taxes

Comparison

Category Labor: Home Guarantee & Help to Buy Coalition: Mortgage Tax Deduction
Deposit requirement 5% deposit with no LMI (Home Guarantee) or 2% deposit with government equity (Help to Buy) No specific deposit support
Income cap No cap for Home Guarantee; $100k (single) / $160k (couple) for Help to Buy $175k (single) / $250k (couple)
Property price cap No cap under new policy (previously had location-based caps) Indirect cap – deduction applies to loans up to $650k
Eligible property type New and existing dwellings New builds only
LMI savings Yes – avoids Lenders Mortgage Insurance No – LMI still applies
Government equity Yes – government owns up to 40% (Help to Buy) No
Support type Direct: deposit guarantee, shared equity, and public construction of 100,000 homes Indirect: mortgage interest tax deduction and relaxed lending proposal
Timing of benefit Upfront – reduces deposit and mortgage size Ongoing – income tax savings over five years

Which scheme you reckon is better
Which one is more bullish for property ,

Poll Options

  • 70
    ALP - 5% Deposit for all FHB
  • 37
    LNP - Tax deduction for mortgage interest
  • 525
    BOTH WILL INCREASE HOUSE PRICES --> NET LOSS FOR FHB
Financial First Home Buyer

Comments

  • Jaduqimon on 13/04/2025 - 13:00
    +5

    On first glance it feels like
    ALP: helps with initial deposit but doesn't help purchasing power as the borrowing capacity is unchanged by their policy.

    LNP: doesn't help with initial deposit but the annual deductions may affect banks assessment of borrowing capacity which. Enables FHB to afford the place they want if they were just a bit off before.

    • samyall on 14/04/2025 - 08:00
      +2

      With the rate interest rates are going, helping with the deposit will be much more important over the next 5-10 years. With 2 bedroom apartments in Sydney heading towards $1M+ saving that $250k is the bottleneck.

    • zorodluffy on 16/04/2025 - 09:46
      +1

      dont see how it would help the banks assesment of borrowing capacity. you only get your tax returned on the financial year after right? so you would still need to be able to make the full mortgage repayments up front

  • MrThing on 13/04/2025 - 13:08
    +98

    LNP policy increases house prices, ALP policy increases house prices

    cool, so no real policy changes

    of course don't touch neg gearing or capital gains concessions, no no no, those wouldn't work /s

    grandfather all neg gearing / capital gains on houses currently owned or invested.
    all houses transacted or transferred after a certain date are not eligible for neg gearing and the capital gains concessions.
    Do not grandfather properties held within companies or family trusts

    • CheapskateQueen on 13/04/2025 - 20:01
      -2

      mic drop

    • pangwen on 14/04/2025 - 07:49
      +8

      In a way, the LNP policy is touching negative gearing… they are expanding it so first home buyers can get into negative gearing too.

      • MrThing on 14/04/2025 - 10:42
        +10

        So making it worse (more $$$) then for tax payers who dont use or need it. It will be rorted anyway by kids with wealthy parents……

        child buys expensive house
        parents pay mortgage
        kids claims huge tax deductions
        ???????
        profit

    • Butterchurner on 14/04/2025 - 09:53
      +13

      No one will push negative gearing for a while after what it did to the Shorten campaign.

      • jonohaha on 14/04/2025 - 10:17
        +9

        sadly this. One of the biggest problem in Australia's economy is the over reliant on real estate.

      • MrThing on 14/04/2025 - 18:25
        -3

        she also brought in the NDIS, another boat anchor to our economy

        What a terrible PM she was

        • belongsinforums on 14/04/2025 - 19:10
          -1

          worst of all, she's a woman!!!

          • MrThing on 15/04/2025 - 12:46

            @belongsinforums: I wouldn't go that far

            Looking critically that period of labor gov between gillard and rudd was a train wreck and so was the proceeding abbott Turnbull gov. Basically a lost 6 years

            You had pink batts, NDIS, Vocational training scams, carbon tax.

            All fleeced the Australian tax payer and some of those programs still do

            • belongsinforums on 15/04/2025 - 12:59
              -3

              @MrThing: youre right. bring on dutton on price! make australia great again!!

            • lgacb08 on 15/04/2025 - 17:23
              +1

              @MrThing: You forgot the biggest elephant in the room, mtm nbn.

              • MrThing on 15/04/2025 - 17:34

                @lgacb08: whats mtm?

                at least with the nbn we will in the end get what we wanted, and thats fibre….but…. at what cost….and how many sub contractors made themselves filthy rich off the tax payer with shoddy quality works

                • Butterchurner on 19/04/2025 - 10:51

                  @MrThing: Multi technology mix i.e. hanging on to copper and cable to cheap out and appease Murdoch.

    • Some Guy on 15/04/2025 - 12:37

      This is terrific. I'd add that negative gearing grandfathered for only one or two existing properties. And foreign entities cannot purchase residential land, only apartments. Confirm that no GCT on PPoR remains but only after 2 or 3 years.

    • idonotknowwhy on 15/04/2025 - 14:15

      of course don't touch neg gearing or capital gains concessions, no no no, those wouldn't work /s

      Neither party will touch these for at least a decade IMO. ALP campaigned in 2019 and the population rejected it. Sort of makes sense given 66% of voters own a home (outright or committed to a mortgage) (https://www.aihw.gov.au/reports/australias-welfare/home-owne…)

      Touching neg gearing or cgt concessions is perceived as a threat to the wealth of 66% of voters.

      • MrThing on 15/04/2025 - 17:20

        I believe it will take the last of gen X and then the millennials to finally remove it… it benefits the older gen x and boomers far to much - they are also typically far more conservative than the young'ins

        last of gen x and millennials are the ones it hurts the most

      • smalltime0 on 16/04/2025 - 11:25

        The actual problem, is that there is no silver bullet.
        If you actually fixed the problem (which would take a lot), you would have a significant amount of the population that over-invested or over comitted (for their own house) stuck servicing loans.

    • frewer on 15/04/2025 - 18:04

      Another sting bit is

      Yes – government owns up to 40% (Help to Buy)

  • boomramada on 13/04/2025 - 13:12
    +15

    Add poll option, both will increase the house prices lol

    • Dr Phil on 14/04/2025 - 18:28
      +1

      100% correct
      Any time the government interferes with the free market mechanism, trying to make things cheaper, they always push UP prices.

      I remember when petrol prices were going up and gas converted vehicles where the go.
      The cost to convert a Holden or Ford to LPG as about $1,800

      The government introduced a $2,000 subsidy to basically pay for LPG conversions , the price went up to $4,000 almost overnight. The only winners were the LPG conversion mechanics.

      Same back in 2009 when the government tripled the home owners grant from $7,000 to $21,000.
      Before you could buy 2 bedroom units in affordable suburbs around Sydney for $200K to $220K
      After the change in the home owners grant, prices had jumped up to $260K - $280K in just 3 months.

      • nk10025 on 15/04/2025 - 22:16

        Do these converted vehicles exist in market?.. so this can be concluded as a failed policy. Government shouldn't encourage property ownership altogether.. I think they should introduce rental tax back scheme where people on rental get tax incentives. Like in advanced countries like Germany people don't want the burden of ownership. Would anyone confirm?

  • Hellfire on 13/04/2025 - 13:13
    +38

    They aren't the right policies. We need them to focus on increasing supply and reducing demand.

    • trustnoone on 13/04/2025 - 13:40
      +7

      Safe housing supply. My worry with Coalition plan is that it makes people buy a new property that they can only just afford using the new home grants. I feel the idea is that then developers will build more. But I worry its going to all be "quantity over quality" leading to many needing extensive rework from the builder within those first 7 years.

      But because all these builders disappear right after the build, all these people who bought properties they could only just afford will now be hit with levies they didn't see coming because "its supposed to be new right".

    • boomramada on 13/04/2025 - 13:53
      +5

      increasing supply - only if there is a solution for more tradies, more land availability, and not so inflated material costs.

      • tenpercent on 13/04/2025 - 14:03
        +2

        State governments could help with land availability but they are all in bed (both sides) with the big developers so that won't happen.

        • wtfisgoingon on 13/04/2025 - 14:43
          +3

          The Vic govt has aggressively opened up land and overhauled planning laws and we're building houses at a faster pace than anywhere else in the country: https://www.realestate.com.au/news/the-state-winning-the-rac…

          Big developers want to build houses. I really do not understand how getting in the way of them doing so is being in bed with them?

          • TheFreaK on 15/04/2025 - 10:31
            +1

            @wtfisgoingon: Yep and they've failed to upgrade road infrastructure at the same rate leading to severely increased congestion on the roads

            • wtfisgoingon on 15/04/2025 - 10:37

              @TheFreaK: I agree infrastructure hasn't kept up, although that's a multi-decade issue in Australian cities. No one government can come in and fix the problem because infrastructure takes too long to build. Then the next government comes along and cuts the previous government's projects. It's crap and a problem with both parties and an immature electorate that hates change.

              But aside from very specific instances, road infrastructure is usually a waste of money. You build more, people drive more, you rarely make a significant dent. Induced demand makes it a waste of time and money: https://escholarship.org/uc/item/3q21f88p

              The Vic government has spent a lot on public transport, although not always in the best spots and much less efficiently than I would like. The Suburban Rail Loop is bad policy. But more roads is not the answer.

          • braddsey on 15/04/2025 - 21:10

            @wtfisgoingon: How about incentivising buyers to take up the ~8000 apartments that are built and empty, as suggested in this article…
            https://www.theage.com.au/national/victoria/the-melbourne-su…

            • wtfisgoingon on 15/04/2025 - 21:47

              @braddsey: I don't have a subscription but the article says hundreds. And you don't really need to incentivise, the market does that. If apartments are empty then the developer wears the cost for building apartments people don't want

              • braddsey on 16/04/2025 - 09:36

                @wtfisgoingon: The article says 8000 (I do have a subscription), but it doesn’t specify why these apartments are unsold, but does give details about potential stamp duty tax breaks to make purchasing more available.
                You are correct - the developer wears the cost of the unsold apartments, but the government is reliant on the developers to build the additional housing stock required. If the developers have a large amount of capital tied up in existing stock it reduces the ability and will to build more inventory. From the developer perspective, they have enough supply in the locations they’ve been encouraged to build. Adding more stock (that will be higher cost) won’t alleviate the issue.

                • wtfisgoingon on 16/04/2025 - 12:08
                  +1

                  @braddsey: I'm prima facie skeptical of bailing out companies who made bad decisions. It sounds like nobody wants the apartments. If that's the case, they can drop the price until someone buys them. I'm not sure the government incentivising buying up specific apartments is a good idea.

        • boomramada on 13/04/2025 - 14:56

          State governments could help with land availability

          Sure, ACT State government release land and makes buyers bid for it, the winners are the State government, with high taxes and the rich investors, sure, how is that going to help FHB? LOL

          • tenpercent on 16/04/2025 - 09:43

            @boomramada: It doesn't have to be released that way.
            It could be released preferentially to FHB and only opened up to other citizens after say 12 months, and then opened up to businesses (such as the big developers who tend to get ALL the new land released now) another 12 months after that. It could also be sold at a fixed cost per square metre to FHB, a slightly higher fixed cost per square metre to other citizens, and then if anything is leftover let the developers have a bidding war with themselves only (not competing with citizens).

      • Protractor on 13/04/2025 - 21:06
        +1

        The tradie issue will be resolved ( vomit now) by importing useless OS sub standard wannabe trades impostors , dressed in fluoro.
        There won't be 20% of houses built post covid without multiple serious building flaws (or worse) ,such is where the CF of house building in Straya, has landed.

        To build or not to build in a country where rent is exorbitant (even if you can secure it) is the greatest ever failure of both major parties. It's as under the bus as any govt could be. Imagine how shit the cheap nasty version of first homes are going to be in the next few years. Waterboarding by mortgage entrapment is the new black.

        State govts should always have had peri-urban (on already cleared land) set aside decades ago, not as now, buying via on the run, at prices the greedy investors demand ,and always get.

      • miicah on 14/04/2025 - 09:08
        +7

        more tradies

        You mean like Labor continuing to fund fee-free TAFE, instead of Liberals gutting the TAFE system for their mates?

    • tenpercent on 13/04/2025 - 14:02
      +1

      How do we reduce demand?

      • marcozmitch on 13/04/2025 - 15:36
        +1

        Forced migration to other countries, follow policies of Japan, start a war with a belligerent foreign neighbour?/ ALL jokes…

      • lew380 on 14/04/2025 - 08:03
        -6

        Stop importing 1 million new Gazan type immigrants per year. We have had good controlled and skilled immigration, but now we are just mass importing the third world out of some warped Quazi religious goal to end the white race or start a civil war or mass cheap labour or all of the above.

      • tessel on 14/04/2025 - 13:19
        +4

        You need more up votes. We reduce demand by making residential real estate something that doesn't make you rich. I'm gonna get some hate but the problem isn't about supply. It's because people see real estate as a way to get rich. You need to remove that incentive and you'll see demand drop. How that is done, well, yeah, (profanity) me. Limit residential properties to a maximum of 1 PPOR and 1 IP? Raise council rates, stamp duty, tax the living shit out of it to make owning IPs just not worth it? Essentially, tax the (profanity) out of it so residential property is not seen as an investment asset that gets you rich. Second option? Stop migration, let births collapse so no-one is having children and demand for real estate will fall off a cliff. OK, bring it on. Popcorn ready.

        P.S: I made posts about this before. Real estate prices aren't going down. World War III is the only thing that will fix this. I'm not joking. The economy is real estate. It cannot collapse and they will not let it collapse.

        • braddsey on 15/04/2025 - 21:13

          The problem with limiting investment properties is the government doesn't have enough social housing. If you limit investment properties, who will provide the rental properties that people who don't own homes are going to live it? There's not many "built-to-rent" projects about…
          Not everyone wants to own property, and even with all the housing reduction we could muster, there's still plenty of people who could never afford to buy.

          • tessel on 16/04/2025 - 08:27

            @braddsey: Totally agree. Government would need to step in and start actually doing something. Unfortunately we can't give everyone a house. The system is broken but that doesn't mean we shouldn't try to make it less broken. Currently, it's a free for all (profanity) everyone I want to make mad real estate gains…

    • freefall101 on 13/04/2025 - 14:03
      +3

      There's a lot of things they could do on supply that might not go down so well. You look at who we bring into Australia and it's all tourists, students and people working in mining or aged care. Our housing industry isn't setup to make use of work visas well. China is going through a housing slump, we could easily bring in a few thousand for a few years to decrease salaries. But that would set a lot of people off.

      Most construction materials we could support making here or get more involved in the supply chain. Most construction companies are small and fall over with the change of the wind. Considering how much money we put into housing, you'd think it'd have the strength of our banking, aged care and mining industries but half the time a house is built by "123 Main St Pty Ltd" and folded at the end. They don't have the capacity, as we saw with plenty folding once prices of materials went up. You'd think something more vertically integrated could make a killing in the industry

    • Dr Phil on 14/04/2025 - 18:31

      This is NOT about good policies or economics

      Its purely about politics and looking good.

      Like putting lipstick on a Pig!

    • frewer on 15/04/2025 - 18:05
      -2

      Who cares about the good old supply & demand, when the socialist govern can just 'support' you with tax money

    • Protractor on 13/04/2025 - 21:07

      He's just taking over Scomos CF contract and you know it.

  • mskeggs on 13/04/2025 - 13:25
    +35

    The LNP can't help themselves but tilt things toward the wealthier people, even when they are trying to do stuff like help 1st home buyers.
    By making it a tax deduction, more benefit flows to higher income earners.
    If you earn $175k, and have a mortgage of $650k at 6.09% (the CBA rate calc default) you pay $42780p.a. in interest. Currently, your tax bill is $49588 p.a. tax/levies.
    If the mortgage interest is a tax deduction, your taxable income reduces to $132220p.a. and your tax declines to $33098. That is $16490 Australia has to borrow every year to pay towards this person's house.
    After 5 years they have pocketed $82450 toward their house that Australia has to make up in other taxes or borrowing, and they can sell and keep any gain tax free.
    If you have a spouse earning $75k part time, presumably you can pocket a bit more, as the family ceiling is $250k earnings.

    Why are we giving handouts like this? Does it make housing more affordable, or just push prices up? Why not give everyone the same benefit, why tilt it toward the rich by making it a tax deduction?
    EDIT: removed comment about existing/new houses as it appears only to cover new houses.

    • Gdsamp on 13/04/2025 - 14:29
      +1

      well the ALP policy still benefits high income by removing the income cap for 5% no LMI FHB loan

      • mskeggs on 13/04/2025 - 14:38
        +10

        I agree that everyone benefits from the ALP policy, but it does not give a bigger benefit if your income is bigger. The value of home it applies to is capped so it isn't helping people buy a $3m house, where the LNP tax deduction applies even if you were buying a $3m house with a $2.3m deposit.

      • surg3on on 14/04/2025 - 15:06
        -1

        It does but its like comparing a thimble to a bucket

    • FlyingMiffy on 14/04/2025 - 08:42
      -4

      Not going to vote LNP this season but there is nothing wrong with giving tax incentives to people to work or who work as a principle. I would even prefer the US policy that ANY interest paid on your primary residence is tax deductible. Makes you wanna work so you can own your own home faster.

      • mskeggs on 14/04/2025 - 12:00
        +6

        This policy doesn't reward work, it provides a bigger benefit to those with a higher taxable income regardless of how you get that income.
        And that reduced tax will require higher taxes on others to make up for it.

        An unemployed person who invested a lotto win would qualify.

          • mskeggs on 14/04/2025 - 13:49
            +8

            @FlyingMiffy: Lol. Maybe back in the war years grandpa.
            I certainly don't work harder than an overnight cleaner or cab driver on a 12 hour shift. Income reflects hard work so rarely these days.
            Even in your example you had to reach back to some time early in a career or when an apprentice got up at 4am because you recognized your first example of working multiple jobs almost never equates to high income.

            Almost every high income earner in Australia today is paid to be seated in aircon. There are a small number that aren't, but if you are have sore muscles at the end of the day it is incredibly likely you aren't a high income earner.

            • FlyingMiffy on 14/04/2025 - 13:59
              -7

              @mskeggs: You are equating hard work to hard labour, grasshopper. A high paying job is not musical chairs, its earnt. And you get yourself into a position to win it by demonstrating experience, competence and capability. Things that you may not have and arent attained by sitting in aircon rooms but hey others have gone through the hard yards to get it so maybe think harder.

              • A Banana4scale on 14/04/2025 - 16:52
                +3

                @FlyingMiffy:

                And you get yourself into a position to win it by demonstrating experience, competence and capability

                you actually believe this shit applies everywhere?

                Go into the AusCorp subreddit and every day there are multiple posts about nepo hires, old boys' clubs and politics in promotions and salary bands.

                While Australia aims to be a meritocracy, I think human nature, networks and power dyanamics play a big part in your success.

  • Benoffie on 13/04/2025 - 13:39
    +5

    Too bad if you've already purchased a house. The assumption that only those who haven't purchased are in need of some assistance is going to piss a lot of the electorate off.

    • tenpercent on 13/04/2025 - 14:05
      +9

      Your argument could be had for any of the actual and proposed first home buyer incentives over the last couple of decades.

      If you've already purchased a house you're already doing a bit better than the 250k homeless population growing by 10k per month. And you're already doing a bit better than the majority of renters who have almost no hope of saving for a deposit.

      • Benoffie on 13/04/2025 - 14:51
        +8

        Policies like tax deductions for mortgages either should not exist or should apply for 1 home per citizen (to be used whenever they want to apply for it).

        There's multiple circumstances where a person, having previously owned a home (and therefore not eligible for FHB), may benefit from such a scheme.

        The growing homeless population you point to would be one, considering many are working poor and pushed out by sky-rocketing rents.

        Of course, none of these policies will actually address the fundamentals and the only thing that will occur are more price rises.

    • jonohaha on 14/04/2025 - 10:10

      not if they see their houses soaring up in value

    • smalltime0 on 16/04/2025 - 11:28

      It's going to inflate your asset, so you have that sweet equity to buy a ute or whatever boomers do

  • Aussiebargainer on 13/04/2025 - 13:42
    +13

    Neither policy addresses the actual issue… supply. By creating more demand just adds to the housing issue.

    • mskeggs on 13/04/2025 - 14:44
      +5

      Labor has committed to building an additional 100,000 new homes for first home buyers as well.
      This might actually help with supply if buyers are not competing with investors.

      • Benoffie on 13/04/2025 - 14:53
        +6

        And how will they magic these?

        More conversion of large homes into 3 units charging market rates for each?

        Certainly not producing large scale public housing

        • mskeggs on 13/04/2025 - 14:54

          Search me. I agree the issue with housing is not a desire to see more built, there is plenty of desire for that.

          • Benoffie on 13/04/2025 - 14:59
            +5

            @mskeggs: Australian housing construction rates have been fairly steady at around 290,000 pa since 1980.

            Nothing they have done has changed that.

            What has changed is an influx of unlicensed and substandard work with houses now only warrantied for 6 years.

            The rate of expected housing rebuild in the next 20 years through failure is anticipated to be significantly high.

            So when politicians talk about these kinds of policies, there are breaking points in the construction industry. And the one breaking now is standards and safety.

            • mskeggs on 13/04/2025 - 15:02

              @Benoffie: I agree with this.
              I don't think either policy is particularly good.
              Presumably some houses being accelerated a bit does a tiny bit more than no houses accelerated. Unlikely to move the needle tho.

      • tenpercent on 13/04/2025 - 14:54
        +2

        Only if they're contributing the military engineering corp and have some magical way to find the construction materials to build them since the construction industry is already running near capacity.

  • arkie0 on 13/04/2025 - 13:47
    +7

    After becoming Prime Minister in 2022, Albo's government introduced the Housing Australia Future Fund (HAFF), aiming to build 30,000 affordable homes over five years. As of March 2025, only 358 homes have been completed under this initiative, with 340 of these being existing projects acquired (from existing houses) and converted rather than new constructions. An additional 7,833 homes are in the planning stages.

    In April 2025, ahead of the federal election, Albanese announced an expanded housing policy: a $10 billion boost to the Homes for Australia plan, increasing its budget to $43 billion. This initiative aims to construct 100,000 new homes for first-home buyers by 2028.

    So based on the track record so far by 2028, we'll:
    *spend 10B
    *have approx. an additional 1.2k homes
    *have approx. 1.1k of those homes will be "delivered" via acquiring and converting existing housing
    *have 26k houses in the planning stage

    Depending on migration by 2028, we'll also have an additional 750k-1.5M new immigrants to house.

    • tenpercent on 13/04/2025 - 13:53
      +4

      Albanese announced an expanded housing policy: a $10 billion boost to the Homes for Australia plan, increasing its budget to $43 billion. This initiative aims to construct 100,000 new homes for first-home buyers by 2028.

      Imagine thinking you can get built in 2025 or later an additional 100k homes for $10B ($100k per home).

      • mskeggs on 13/04/2025 - 14:46
        +5

        Imagine thinking you can get built in 2025 or later an additional 100k homes for $10B ($100k per home)

        I don't think they plan to give them away. The funding is to accelerate building, and the homes will be then sold and presumably the proceeds returned until the target is reached.

    • wtfisgoingon on 13/04/2025 - 14:38
      +7

      Our problem as a country is we see everything as a federal issue. The single biggest problems with housing supply in this country are state/council level. They're crappy, overly burdensome zoning laws. They're NIMBYs fighting everything left, right and centre and councils bending over backwards to accommodate them.

      I'm not a huge fan of the Victorian government, but one of the best things they did in their entire term was overhaul all of our planning laws to facilitate more building. And it's working: https://www.realestate.com.au/news/the-state-winning-the-rac…

      It was the only state to see a drop in value in the last property report. Other policies like the land tax have probably helped, but nothing like as much as just allowing more building.

      • arkie0 on 13/04/2025 - 14:58
        +1

        I think most people understand it's a number of things that contribute to housing affordability.

        My issue is wasting time on policies like the 2 here, both which will push up prices and making empty promises, if the biggest problem is at the state level, cool - say that rather promise to build 100k new houses, do something like states which meet their building targets get extra funding in the tune of 100B etc.

        Or why not do something that's in the federal government's control namely tax policy and immigration.

        • wtfisgoingon on 13/04/2025 - 15:03
          +2

          Tax policy won't do anything more than a one off 2% reduction in pricing. Look at the Grattan Institute's analysis of this. It's all about supply and that is a solvable problem, but people direct their political power and energy at the wrong level of government.

          • arkie0 on 13/04/2025 - 15:15

            @wtfisgoingon: Yes boosting supply is the primary recommendation of Grattan Institute's analysis however the same analysis does suggest complimentary policies of tax reform.

            It's a federal election so the focus is on what they can do to help, and both policies suck - we'll redirect the discussion when the Vic state election is on.

            • wtfisgoingon on 13/04/2025 - 15:20
              +3

              @arkie0: I agree with you that both policies suck. I said as much below. But the problem is people fixate on this as a federal issue, so every federal politician uses the only shitty levers they have.

              What I would say is that the housing fund is good policy. Because it pushes state governments. The fact its not meeting its milestones is because those state governments aren't (with the exception of Victoria).

    • RogerLoger on 13/04/2025 - 18:58
      +1

      Politicians do not define 'affordable' and media do not pick them up on it. Until they announce where, specifications, price and who they think can afford them, it is nothing more than a motherhood statement.

      • arkie0 on 13/04/2025 - 19:33

        They do define an affordable housing is one where you spend less than 30% of your income on rent or mortgage repayments, obviously that depends on your income and type of house but realistically it's hard to achieve.

        If you're on minimum wage that's 300 per week and no way you can get a mortgage for a house around 200k.
        And if you're renting in a major city, 300 a week is more likely to get you a room than a house.

        • RogerLoger on 14/04/2025 - 07:40

          Do they define it with their promise of affordable houses, or do they define it in terms of measuring the economy?

          Realistically, they'd need to find 'free land' and put up granny flats. Then there's a fight amongst many thousands of minimum wage earners for small supply. That gets us back to allocation. Either there's a form of allocation that leaves many disappointed, or they let the market dictate the price. Affordable <> achievable by those who aspire to get one. At the same time, they a p'ing off everyone who worked their clacker out to buy an expensive dump, just to get their feet on the lower rung of the property ladder.

    • ThithLord on 14/04/2025 - 08:18

      Please ignore how the HAFF got blocked by the NOalition for over a year, which completely wrecked hundreds of projects waiting on that funding. Then your point makes sense

      • arkie0 on 14/04/2025 - 12:02
        +1

        Well of course lbr/lnp always block each other on everything but labor could have negotiated better with the greens. Doesn't take away from the fact that something was promised and not delivered.

        • ThithLord on 14/04/2025 - 13:15

          Labor are in Government, the Greens are not. The Greens blocked vital funding allocated to Women fleeing domestic violence.

  • tenpercent on 13/04/2025 - 13:59
    +3

    More BS from the egg-nog heads in Canberra.

    Neither the ALP's nor the LNP's nor the Greens housing policies addresses supply of housing (they have little influence over that to be honest considering the construction industry is running near capacity with both qualified labour and materials being bottlenecks).

    Neither the ALP's nor the LNP's nor the Greens housing policies addresses demand for living in housing. The ALP's and LNP's policies propose to increase demand for buying first homes. The Green's policy proposes to slightly reduce demand for buying houses from smaller investors (which will mostly shift those properties to larger postiviely geared investors' hands). None of them are addressing total demand for housing (living in housing) and so once again renters and the growing homeless population are ignored by all and sundry.

    • wtfisgoingon on 13/04/2025 - 14:32

      Both these policies suck. No argument here. More housing supply is the only way out of this crisis.

      But the government has been doing all they can do re housing at the federal level: incentivise the states. Literally 99% of housing supply issues are the state or council level.

      But everyone does these policies every election because they work. Voters fall for them. It's garbage, but it works.

      • tenpercent on 13/04/2025 - 14:39
        +3

        More housing supply and less demand.
        Only one of those levers can quickly stem the tide of growing homelessness in Australia.

        • wtfisgoingon on 13/04/2025 - 14:41

          I assume you mean slashing immigration, but it's a lazy and misguided policy that only hurts us long term. You might not like it, but too much of our economy is built off the back of immigration, including skilled immigration needed to build houses.

          I haven't seen any analysis that it will make a meaningful dent in our housing problem but I've seen a lot of analysis that says it might cause a recession and make us a lot poorer.

          Do I like that we have such a fragile economy? No. Is it the reality we're working with? Yes.

          • mskeggs on 13/04/2025 - 14:52
            +12

            @wtfisgoingon: I don't oppose immigration, really the opposite, but for the last 20 years we have had many more immigrants annually than we can build houses for.

            It doesn't matter if the "economy" is so fragile that it can't accept fewer immigrants if the actual humans who make up the economy cannot be housed.

            The economy would look grand if we doubled immigration again every year, but it would still be a problem for housing and other infrastructure. If a thing isn't sustainable, such as very high immigration, then we shouldn't act as if it can be sustained. Better to address the issue before we have even more impoverished and homeless.

            • wtfisgoingon on 13/04/2025 - 15:01
              -1

              @mskeggs: I simply don't accept the premise that we can't build enough houses for immigrants.

              Housing productivity has absolutely collapsed in the last twenty years: https://www.pc.gov.au/research/completed/housing-constructio…

              It takes twice as many hours as only 20 years ago to build the same house. One of the key reasons for that is unnecessary and overly burdensome regulation. Regulations that make it hard to do things at scale and require slow, complex approvals.

              We could literally build twice as many houses if we just corrected for that simple problem. That would do wonders.

              • mskeggs on 13/04/2025 - 15:12

                @wtfisgoingon: If you think the issue leading to higher property prices is the speed with which they are approved or the scrutiny under which they are regulated, I think you are misguided.
                The PC report you linked points out like-for-like productivity declined 12% over 30 years (the 53% figure makes no allowance for larger or better quality houses).
                This isn't great, but is a drop in the ocean of the impact of house prices, a fraction of a percent a year.

                These policies won't move the needle on housing affordability. Neither will planning/regulatory improvements alone, neither will zoning changes alone, neither will immigration reductions alone, neither will changes to negative gearing alone, or CGT discount alone.

                But nobody is prepared to tackle all these things to make a change, even if it takes 20 years.
                I'd love to snap my fingers and fix housing affordability, but even a comprehensive plan will take decades.
                But the absence of a comprehensive plan means it will never happen.

                • wtfisgoingon on 13/04/2025 - 15:18
                  +1

                  @mskeggs: Every economist and expert I've read on this issue says that housing supply is the biggest issue and of all the problems plaguing supply, planning laws and regulation are the biggest problem.

                  The reason I focus on the 53% figure is that part of the problem is that most cities have rebelled heavily against building smaller, cheaper townhouses, houses and apartments. For decades cities have fought tooth and nail against them. And they can be built at a much lower cost and at much greater scale.

                  Over that same time that like-for-like declined, overall productivity across the economy rose 49%. Why is housing so unlike the rest of the economy that it can't see productivity improvements, rather than dramatic productivity decline?

                  • mskeggs on 13/04/2025 - 17:52

                    @wtfisgoingon: Every economist may argue the issue is productivity, but that isn’t true.
                    Like for like productivity according to your link is down 12% over 30 years.
                    This does not account for the huge increases in housing costs.
                    If we could lift construction productivity, great, it might contribute enough to move the needle slightly over the next three decades.

                    Over the same time frame we have seen the combined impact of negative gearing plus discount CGT, immigration that has approx tripled, plus the underinvestment of infrastructure to support growth.
                    I’m happy to grant we need more focus on regulatory, labour, zoning etc, but these things were not that different 30 years ago, and have only changed 12% in that time.

                    If housing costs mirrored the increase due to productivity decline we would not have a housing problem.

                    • wtfisgoingon on 13/04/2025 - 20:34

                      @mskeggs: I'm sorry to be blunt, but I think you need to read up on these things more. Saying the economists are wrong and then saying a bunch of stuff that you feel is the source of the problem isn't analysis.

                      Productivity declined 12% in a period in which overall productivity increased 49%. So relatively it is 61% behind the rest of the economy.

                      Regulatory, labour laws etc are far far more impactful these days than they were in the past. They also have changed dramatically over that time. It's simply wrong to say they haven't.

                      If you believe negative gearing and CGT are the big issue, you are simply uninformed. They just aren't big enough contributors to the market to offset the huge supply issue.

                      I trust economists and experts over the feelings of people on the internet. Sorry.

                      • mskeggs on 13/04/2025 - 21:43

                        @wtfisgoingon: I understand why you can feel economists saying productivity is to blame is an easy solution.
                        The problem is economists are saying "assuming the situation we have, with tax, migration, labour, zoning etc. are in place, how can we fix it".
                        With those fixed assumptions, improving productivity is the only lever left.

                        You don't need to be an economist to understand that productivity has not improved as fast as other areas of the economy. And it is a common issue globally https://www.planradar.com/gb/productivity-index-in-construct…

                        But productivity growth in other industries and it is down to automation, scale, abstraction. It's going to be hard to get the productivity gains you are suggesting, especially when others haven't been able to.

                        I guess we could just build soviet era (or UK post-war style) apartment blocks, to cookie cutter plans, small, prioritising quantity. But it is hard to see how to raise productivity for construction of the properties people want to live in today.
                        Even if there was no council approval process, no quality inspections, how could we double the output of construction?

                        I do understand why you would trust an economist because there are lots of numbers flying around, and you have had trouble understanding the decline in productivity is almost all because people are building bigger and higher quality homes, but you do need to look a little harder than saying "productivity will cure it".

                        How would you increase productivity, and how would those changes make up the changes we need? Where will you find the increased workers? Which regulations are superfluous? Which communities can be ignored if they oppose extra housing?

                        I agree it would be good to streamline regulation, but the things that changed over the past 25 years as housing prices exploded was a change in tax policy and a substantial growth in immigration.
                        Before those changes, regulation was not a substantial constraint.

                        I guess I am saying, why is the fix for massively increased immigration, and a tax system that greatly incentivises housing investment a productivity boost nobody has been able to provide? Why limit yourself to only that fix?

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