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{{propApi.successMessage}} {{region}} Change locationMore tax on housing is not the answer to inflation
More tax on housing is not the answer to inflation
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“HIA’s 2026–27 Pre-Budget Submission outlines a suite of supply-side reforms across taxation, finance, infrastructure, planning, skills and regulation to support delivery of the Government’s target of 1.2 million homes by 2029,” HIA Managing Director, Jocelyn Martin said today.
“Importantly, it highlights that persistent housing undersupply is contributing to inflation pressures, worsening rental conditions and constraining economic growth.
“Housing supply is no longer a cyclical issue, it is a macroeconomic problem. If we want to ease inflation, improve productivity and restore affordability, we must remove the barriers preventing new homes from being built.
“Housing is already one of the most heavily taxed sectors in the economy. Further tax changes, including to negative gearing or capital gains tax, would undermine investment, reduce feasibility and worsen affordability,” she said.
“HIA has also calling for a review of cumulative macroprudential settings, warning restrictions on lending are locking first home buyers out of the market and adding pressure to rents without addressing the underlying supply problem.
“To unlock stalled apartment projects, HIA has proposed a national program to expand state-based pre-sale finance guarantee schemes. Across the country there are projects ready to go but stuck because of financing constraints. This is a solvable problem if housing supply is treated as a national priority.
“We estimate that the nation could need as much $5 billion boost to ‘last-mile’ enabling infrastructure funding to get homes shovel-ready sooner.
“Addressing construction workforce shortages is also central to lifting supply. HIA has called for the long-term continuation of employer apprentice incentives, funding for pre-apprenticeship programs, targeted trade migration pathways and improved skills recognition processes for migrants.
“Housing targets will not be met without a larger workforce. Business as usual will not deliver the trades numbers Australia needs,” Ms Martin said.
HIA has also urged the Government to reduce regulatory burden by moving the National Construction Code to a five-year amendment cycle, providing free access to Australian Standards and cutting cumulative red, white and green tape adding unnecessary cost to new homes.
“The 2026–27 Budget will be a test of whether housing supply is taken seriously. The focus must be on stability, coordination and reforms that increase supply, not measures suppressing it,” concluded Ms Martin.
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An update on Victorian working from home and buyer protection laws
The Victorian Government's Working from Home Bill has become available, and proposed buyer protection laws have undergone some changes.
Enforcement intensifies as compliance expectations climb
On 15 January 2026, penalties for non-compliance were increased under the Building Work Contractors Act 1995, Fair Trading Act 1987, and the Plumbers, Gas Fitters and Electricians Act 1995. The reforms also introduced new offences including undertaking, or engaging others to undertake, unlicensed work.
HIA's position on Australian Standards
HIA advocates for a more transparent, efficient and accountable Australian Standards system. This policy outlines HIA's recommendations for improving the development and enforcement of Australian Standards, and the role of the Australian Building Codes Board in assessing the impact of standards referenced in the National Construction Code.
400,000 more Australians, 50,000 too few homes
“Australia needed to build more than 250,000 homes last year just to keep pace with demand growth and begin reducing the housing shortage and yet we commenced less than 200,000 homes. This is why home prices and rents are rising,” stated Tim Reardon, HIA’s Chief Economist.