‘Taxpayer-funded welfare’: Albanese uses once-unthinkable Barefoot Investor phrase to describe the Australian property market – as house prices plunge on his watch

Prime Minister Anthony Albanese has defended Labor’s housing tax changes, saying the government’s priority is making homes more affordable for first-home buyers instead of protecting sky-high property values.

During Question Time on Tuesday, Opposition Leader Angus Taylor attacked Labor for triggering a housing downturn through its reforms to capital gains tax and negative gearing.

Taylor pointed to fresh ANZ forecasts predicting sharp falls in house prices and challenged the government to admit that its policies had left homeowners worse off.

ANZ now forecasts capital city house prices will drop 4.3 per cent this year and another 3.4 per cent in 2027, a peak-to-trough fall of 10.6 per cent. Sydney is projected to suffer the biggest fall at 14.5 per cent, followed by Melbourne (12.8 per cent), Adelaide (9.8 per cent), Brisbane (7.9 per cent) and Perth (5.2 per cent).

Labor’s reforms, announced in the May Budget scrapped the 50 per cent capital gains tax discount and replaced it with a flat 30 per cent rate indexed to inflation. Negative gearing concessions were limited to new homes only.

Albanese told Parliament the changes are about giving young Australians a fair crack at home ownership.

‘In the Budget, it is true that we had measures that were aimed at addressing the challenges that are facing young Australians when it comes to owning a house,’ he said.

The Prime Minister quoted financial commentator Scott Pape, the Barefoot Investor, in describing the government’s previous policies are resembling ‘taxpayer-funded landlord welfare’ – a comment that would be once unthinkable for the PM to make.   

 

‘Average house prices have increased by more than 400 per cent since 2000, partly on the back of taxpayer-funded landlord welfare. They’ve grown much faster than workers’ wages. Which is why we’re in this pickle,’ Albanese said, citing Pape.

He also echoed Pape’s view that Australians have begun viewing property as an investment, rather than a place to live. 

‘Somewhere along the way we started treating houses like a share price. Something to check, brag about, and borrow against. We forgot what they’re actually for. A house is for living in,’ he said.

Albanese said Labor’s changes are designed to give first-home buyers a genuine shot, not just force them to compete with investors.

‘Last Saturday, when people were going along to an auction for an existing home, they were not competing against investors seeking to negatively gear the property; they were competing as people who wanted a roof over their head,’ he said.

Albanese said he wants a housing market where home ownership isn’t determined by family wealth.

‘I don’t want to be a Prime Minister who leads a country that sees growing inequality, that sees the opportunity for people to get into their first home as being defined on whether mum or dad can help them,’ he said.

‘I want people to have the opportunity to be the first in their family to own their own home.’

Albanese argued the reforms are about restoring the ‘great Australian dream’, warning that home ownership would slip further out of reach for younger Australians without a change in direction.

‘The truth is that the great Australian dream was becoming a nightmare because, if people can’t get that access to home ownership, it changes everything else in their lives,’ he said.

The Coalition says Labor’s housing tax changes are discouraging would-be home buyers, pointing to new lending data that suggests fewer Australians are entering the market.

Commonwealth Bank reported on Wednesday that new home loan applications had fallen by as much as 20 per cent, a figure the opposition argues undermines the government’s claim that its reforms are improving housing affordability.