Australian housing was already cooling before the budget – but how cold it gets depends on two key factors
Australian housing prices have shown signs of cooling following recent budget changes to negative gearing and capital gains tax. While some argue these policies negatively impact the market, economists suggest that long-term supply constraints remain the primary driver of price trends.
Why it matters
Housing affordability is a major economic and political issue in Australia, directly affecting household wealth and social stability.
After negative gearing and capital gains tax changes were revealed in the 12 May budget, housing data has begun to show how they may affect Australia’s property market. Illustration: Victoria Hart/Guardian Design View image in fullscreen After negative gearing and capital gains tax changes were revealed in the 12 May budget, housing data has begun to show how they may affect Australia’s property market. Illustration: Victoria Hart/Guardian Design Housing Analysis Australian housing was already cooling before the budget – but how cold it gets depends on two key factors Jonathan Barrett Most economists believe the chronic undersupply of homes will eventually push prices higher once interest rates ease and the tax changes are priced in
The article balances government policy criticism with economic analysis regarding market supply and demand.
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