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HIA Chief Executive Industry & Policy Simon Croft, said the reforms risk compounding Australia’s already critical housing shortage by undermining confidence and reducing capital flowing into new residential construction.
“These changes send exactly the wrong signal at the worst possible time and represent multiple own goals in the national effort to boost housing supply.
“Australia is in the grip of a housing supply crisis, yet these measures will dampen investment in new housing and make it harder to deliver the homes Australians urgently need."
HIA said the scaling back of negative gearing and CGT settings would weaken measures that have historically supported investment in residential construction, particularly in the delivery of new housing stock.
“The reality is that investors play a key role in funding new housing. Curtailing these incentives will lead to fewer homes being built and place further upward pressure on rents and prices,” Mr Croft said.
“At a time when all levels of government say increasing housing supply is the top priority, these reforms are an own goal. They actively work against that objective by discouraging the very investment needed to deliver new homes,” Mr Croft said.
HIA also warned that changes to SMSF investment rules would strip an important source of funding from the housing market.
“SMSFs have become an increasingly important provider of capital for residential investment. Restricting their participation will further tighten housing supply and reduce market resilience.
“The combined effect of the legislated changes would ripple across the economy, reducing construction activity and putting jobs at risk in one of Australia’s largest employing industries.
“Instead of encouraging investment to boost housing supply, these changes risk driving investors out of the market entirely.”
HIA reiterated that improving housing affordability requires policies that increase supply—not measures that discourage investment.
“These reforms should have been red carded. Australia needs policies that unlock housing supply, not restrict it,” Mr Croft said.
The Association urged the Government to work closely with industry to mitigate the impacts of the changes and refocus efforts on practical solutions, including planning reform, faster approvals, cutting red tape and greater land availability.
The Housing Industry Association (HIA) has welcomed the Prime Minister's acknowledgement today that housing must remain a central consideration as Australia expands its digital infrastructure and data centre capacity.
This member alert is for members who enter into domestic building contracts entered into before 1 July 2026. It is also important information for members who enter into domestic building contracts with clients with untitled land.
Over the past few weeks HIA has been advocating strongly on behalf of members on a range of policy and regulatory issues that have significant implications for housing supply, business confidence and the capacity of our industry to deliver the homes Australia needs.
The Housing Industry Association (HIA) has today written to the Tasmanian Government calling for a commitment that state-funded and state-partnered housing work will continue to be awarded on merit, not industrial arrangements, warning new federal procurement rules could shrink the pool of builders able to deliver the homes Tasmania needs.