Labour’s campaign in 2025 placed a heavy emphasis on housing affordability, tenant rights, and social infrastructure. Among the key housing-related policy promises were:
- Increased investment in social and affordable housing, with a target of building 250,000 new dwellings over the next five years.
- A review of negative gearing and capital gains tax concessions, aimed at rebalancing the market in favour of first-home buyers.
- Stronger rental reforms, including caps on annual rent increases and longer-term rental agreements.
- Support for build-to-rent developments, through financial incentives and planning reforms.
- Commitments to net-zero emissions in new housing developments, introducing environmental building standards that will affect developers and landlords.
These proposals mark a clear departure from the more investor-friendly approach of previous Liberal governments, signalling potential change — and opportunity — for many market participants.
What will be the Impact on Property Investors
One of the most closely watched aspects of Labour’s win is its stance on negative gearing and capital gains tax (CGT). While the party has ruled out any immediate changes to existing arrangements, there is strong speculation that future reforms may limit tax deductions on newly purchased investment properties or alter CGT concessions for long-term holdings.
Potential implications for investors include:
- Reduced tax incentives will dampen demand for investment properties, especially in major cities.
- A shift in investment interest towards new builds, if negative gearing is restricted to newly constructed homes.
- Increased interest in build-to-rent schemes, as institutional investors seek to take advantage of emerging government incentives.
While this may raise concerns for some investors, others may see opportunity in adjusting their strategies to align with future tax settings and planning regulations.
First-Home Buyers: A Market Tilt in Their Favour?
Labour’s platform has long aimed to level the playing field for first-time buyers, who have been squeezed by high prices, investor competition, and sluggish wage growth. By reviewing property tax concessions and investing in new housing stock, the new government hopes to create more accessible entry points into the market.
Benefits for first-home buyers may include:
- Greater housing supply and reduced competition from investors could ease price pressures in key metropolitan areas.
- Enhanced government support through shared equity schemes and first-home buyer grants.
- More opportunities in the outer suburbs and regional areas due to expanded infrastructure investment.
The success of these policies will depend largely on implementation and market conditions, but sentiment among young buyers is likely to improve in the short term.
Renters and the Rental Market
Labour’s all about helping renters, you know? They promised to make renting less of a hassle—more secure, cheaper, and just better overall. Look, finding a place to live that’s not gonna break the bank is a huge deal for heaps of Aussies right now. So, if they shake things up in the rental market, it could really change things for people renting and the folks who own the places.
Key reforms include:
- National standards for rental increases, limiting how often and by how much landlords can raise rents.
- Promotion of longer-term leases, aiming to provide renters with greater stability.
- Funding for minimum housing quality standards, including insulation, ventilation, and safety features.
For landlords, these changes may introduce new compliance costs and potentially limit rental yields in the short term. However, they also pave the way for more stable tenancies and could encourage institutional ownership in the rental market. Developers and the Construction Industry
Labour’s housing plan includes a significant ramp-up in public and affordable housing construction, which may provide a much-needed boost to the construction and development sector, particularly in the wake of material shortages and labour cost increases seen in recent years.
Developers may see:
- Increased demand for partnerships in government-backed housing projects.
- Incentives for sustainable building practices and energy-efficient developments.
- Zoning and planning reform aimed at streamlining approvals for high-density and affordable projects.
While developers may benefit from the volume of work available, compliance with stricter environmental and social mandates may require upfront investment and innovation.
Economic and Regulatory Considerations
The property market does not exist in isolation. Broader economic indicators — such as interest rates, consumer confidence, and migration policy — will also shape outcomes.
- Labour is expected to maintain a collaborative stance with the Reserve Bank, supporting low to moderate interest rates while inflation remains under control.
- Immigration is set to increase slightly under Labour’s skilled migration plan, potentially supporting housing demand in urban centres.
- Infrastructure spending is likely to remain robust, with ongoing investments in transport and regional development — factors that can support suburban and regional property values.
Market observers should also pay attention to state-level housing policy, as some measures (e.g., stamp duty reform) fall outside federal jurisdiction.
