Australia’s peak community and housing groups have called on federal parliament to quickly pass Labor’s proposed changes to negative gearing and capital gains tax (CGT), describing the reforms as 'long overdue' and crucial for improving fairness for renters and first home buyers.
The government may introduce the legislation as early as the next sitting fortnight, with hopes of securing passage with Greens support. The changes would limit new negative gearing to new-builds, grandfather existing properties, and alter CGT calculations—measures Labor says will rebalance the housing market toward owner-occupiers rather than investors.
Maiy Azize of Everybody’s Home dismissed concerns that the reforms would lead to rent hikes, stating: 'Existing landlords get to keep these tax perks. Any attempt to use these reforms as a justification for raising rents is opportunistic profiteering.' A joint statement from the Australian Council of Social Service (Acoss), Everybody’s Home, Better Renting, and National Shelter backed the changes, predicting they would encourage long-term investment and improve housing stability.
Treasury modelling forecasts 35,000 fewer homes built over the next decade as investors shift away, but estimates the impact on median rents at just an extra $2 per week. The modelling also projects an additional 75,000 first home buyers and 30,000 new homes supported by regulatory changes over the same period.
Critics, including shadow treasurer Tim Wilson, have cited SQM Research modelling suggesting weekly Sydney rents could rise by $160 and Melbourne rents by $130. However, Labor sources argue that modelling does not reflect the policy’s grandfathering provisions, which allow existing negatively geared properties to retain their tax treatment.
Jacqueline Phillips of Acoss said negative gearing and CGT concessions had 'supercharged inequality, driven up housing prices, and added little to rental supply,' urging all politicians to back the reforms. Housing minister Clare O’Neil also highlighted the government’s increases to Commonwealth Rent Assistance in recent budgets as additional support for renters.
