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$vuetify.icons.faPhone1300 650 620

Taxation's major impact on housing

HIA engaged the Centre for International Economics (the CIE) to undertake a review of taxes, fees and charges on new housing and apartments. The findings of the 2025 report provide some sobering reading on the impact government taxes, fees and charges are having on housing supply and affordability.

House and tax package

Apart from alcohol and cigarettes, housing is the most taxed sector in the country.

Governments continue to talk about addressing housing affordability, yet at the same time are collecting more than half a million dollars on a new house and land package.

You don’t get more housing by taxing it more.

Independent research

The 2025 CIE report (which is an update from the 2019 CIE report) shows that:

  • Up to $576,000, or almost half, of the cost of a new house and land package in Sydney is government taxes, regulatory costs and charges. 
  • The value of taxes and charges in Sydney has increased by 38 percent or $160,000 compared to the 2019 report. 
  • The largest increase in the value of tax and regulatory imposts was in Brisbane, up by $179,000 or more than double (+106 percent) compared to the 2019 report. 
  • It takes over a year to obtain a development approval for subdivision, and seven months are attributed to unnecessary delays.
Statutory taxes, regulatory costs and infrastructure charges for greenfield houses. 

Apartments not spared from taxes

The CIE report also looked at the taxes, fees and charges associated with new apartments and the findings were equally dire.

The report found that up to $346,000, or 38 percent, of the cost of a new apartment in Sydney is government taxes, regulatory costs and charges.

The value of the tax and regulatory cost component of a new apartment has increased by $104,000 or 68 percent in Brisbane compared to the 2019 report.

A key reason why apartment affordability and apartment approval numbers are at decade lows is due to these regulatory imposts.

Statutory taxes, regulatory costs and infrastructure charges for infill apartments

How to solve the housing crisis

Australia has an acute shortage of housing because governments continue to tax new home building and impede productivity in the sector.

Governments are adding in excess of half a million dollars to the cost of a new home, that new home buyers are then required to repay as part of their mortgage for decades.

Over 30 years, the value of taxes plus the interest on it amounts to more than the value of the home itself.

Government taxes, fees and charges on new homes have doubled in five years. Not even the best, legitimate investment strategies could achieve that same level of return.

The primary solution to resolve Australia’s housing shortages is to remove government taxes and red tape to allow the industry to deliver the homes Australians are demanding.

Download report

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