JUST IN: ANTHONY ALBANESE REVEALS WHAT’S REALLY DRIVING HIS NEGATIVE GEARING AND CAPITAL GAINS TAX REFORMS..!
Anthony Albanese has openly declared that the 400 per cent growth in house prices over the last 20 years cannot continue and that his reforms are designed to slow the pace.
In a passionate defence of the government’s changes to negative gearing and capital gains tax, the Prime Minister insisted that the current trajectory has put the Australian dream of home ownership out of reach.
“Since 1999 house prices have risen by more than 400 per cent, more than two times as fast as average incomes in the same period,’’ he said.
“The changes that the Howard government made to capital gains tax in 1999 were meant to boost investment in the share market.
“Instead, they turbocharged property investment year after year, more and more young Australians being locked out of the market by tax breaks that favored property investors, widening a gap between the generations and eating away at aspiration.
“(Since 1999) The rate of home ownership among Australians aged 25 to 34 has fallen by 7 per cent.
“Now we owe the next generation better than this, and that’s what these reforms are about.”
Mr Albanese said the reforms were designed to help young people who are working hard, making sacrifices.
“They’re doing everything right, but they’ve spent years missing out at auctions,’’ he said.
“These changes are for young Australians who are this close to just giving up on buying a home altogether. We say to those young Australians, my government has got your back, we back—we are on your side and we’re going to bring the great Australian dream back in reach”
House prices are going through the roof.
Up or down?
Housing Minister Clare O’Neil was grilled on Sunrise this morning about whether she wanted prices to go up or down.
Sunrise host Natalie Barr asked Ms O’Neil: “How much does the government want property prices to fall?”
“Well, that’s not what the government wants and that’s not the effect of the government’s policies,” Ms O’Neil said.
“What we want to see is sustainable growth, Nat.””
But Barr then interjected asking “So you want them to go up?”
“Well, what we want is to see sustainable growth,” the minister repeated.
“Yeah, but just to be clear, do you want house prices to go down or up, Clare, as the Housing Minister?” Barr asked again.
“Pardon,” Ms O’Neil responded.
“Do you want house prices to go up or down?”
The reforms are already hitting house prices. Picture: NewsWire / Gaye Gerard
“I want to see sustainable growth in house prices,” Ms O’Neil said.
“So that’s up?” Barr replied.
“Well, I don’t think we want to see 400 per cent increases in house price over the last 20 years,” the minister said.
“But was that up or down? I’m confused,” Barr said.
“I’m trying to answer your question,” Ms O’Neil said.
“I don’t think we want to see a 400 per cent growth over 20 years which is what we’ve seen.
“But I do want to see property prices grow. I want to see them grow sustainably for the country.”
Housing Minister Clare O’Neil (left) was left stumbling on live television after Sunrise host Natalie Barr (centre) repeatedly pressed her on whether the government wanted house prices to rise or fall. Picture: Sunrise
30-year super cycle ‘close to over’
While Morgan Stanley has predicted house prices could fall by up to 9 per cent, AMP chief economist Dr Shane Oliver says he expects house prices to fall around 5 per cent over 2026-27.
“Units and lower end property are likely to hold up better due to the expanded First Home Buyers 5 per cent low deposit scheme,’’ he said.
He said the continuing slowdown since late last year reflected a combination of rate hikes, poor affordability, depressed buyer confidence partly reflecting the oil supply shock and the Budget changes to exclude new purchases of existing properties from negative gearing and shift to the taxation of real capital gains.
Auction clearance rates
The RBA has raised rates three times back to their prior 2023 cycle high and the AMP chief economist expects another hike in August.
“Rate hikes have usually been associated with some softening in property prices or slower growth,’’ he said.
CANBERRA, ACT, NewsWire Photos. JUN 3, 2026: Prime Minister Anthony Albanese and the Prime Minister of Solomon Islands Matthew Wale hold a joint press conference at Parliament House. Picture: NewsWire / Martin Ollman.
“This is because they cut how much buyers can borrow, hit confidence and can boost distressed sales. Of course, this is not always the case as other factors can intervene like the population surge in 2023 which pushed prices up despite high rates but that seems unlikely this time.
“Poor housing affordability – the ratio of home prices to wages and incomes is at record levels.
“It’s a bit of a perfect storm for the property market. After 8.9 per cent growth in 2025 we now anticipate a fall in national average home prices of around 1 per cent this year and 5 per cent over 2026-27.”
Boom and bust cycles
Mr Oliver notes the first long term boom was in the 1920s and was associated with an economic boom and very strong population growth from the end of WW1 until the early 1930s.
This was followed by a collapse in property prices associated with the Depression, a plunge in population growth and the early years of WW2.
The second long-term boom ran from the end of WW2 and into the early 1970s supported by very strong economic and population growth.
This saw real property prices rise from 50 per cent below their long-term trend to be 50 per cent above trend by 1973.
The golden period to get into property was the mid-1990s, when real prices were more than 20 per cent below their long-term trend and little different to where they were in the mid-1970s.
“This was a great time to get into Australian property!’’ Mr Oliver said.
“This set the scene for the start of the current long-term boom in property prices in the second half of the 1990s, that has taken real property prices from well below trend to around 20 per cent above trend.
“Some would say the shift to taxing 50 per cent of capital gains from taxing real capital gains in 1999 which combined with negative gearing and high marginal tax rates to boost investor demand for property.
“This combined all goes a long way to explain how Australian housing went from cheap in the mid-1990s to expensive in the early 2000s and has stayed there ever since, in fact becoming more so. This can be seen in the surge in house price to wage and income ratios since the 1990s.”
Liberal MP calls “bulls**t” on house prices
Liberal MP Andrew Bragg took aim at Clare O’Neil’s confusion arguing she didn’t need to sugar coat it.
“I say, Clare O’Neil just should have said the truth that everyone knows: house prices for young people in this country are too high,’’ he said.
“I think Australians are looking for authentic leadership. They’re over the bulls**t
“What they want to hear from their politicians are honest answers. And the honest truth is that house prices in this country are too high for young people and they should go down.”
“They’ve been too high for too long and she should have said, “Look, house prices are too high.”
“The reason the 5 per cent deposit scheme has become such a wrecking ball is that it isn’t means-tested, isn’t place-capped, and was implemented in an environment where supply is constrained.”
