The Albanese Labor Government is taking decisive action in the Budget to boost housing supply, make our tax system fairer to help more Australians into homeownership and build on our work over the last four years to build more houses.
This is about building more homes, helping more Australians realise the dream of homeownership and giving younger Australians a leg up in the housing market.
We know it’s too hard for too many Australians to buy their own home and get ahead.
That’s why we’re investing in building more homes, making our tax system fairer and putting first home buyers ahead of foreign investors.
Reforms in this Budget to make the tax system fairer will help 75,000 homeowners into the housing market over the next decade.
We’re coming at this housing challenge from every responsible angle, and this Budget builds on our ambitious housing agenda.
Our housing plan is pro-aspiration and it’s pro-investment.
Labor’s plan for a housing system that works for Australians
- Helping Australians buy a home: We’re levelling the playing field for first home buyers and making the tax system fairer by helping more Australians buy their own home. Combined with our 5% deposit program, we’re shifting the scales in favour of aspiring first home buyers.
- Building more homes, more quickly: We’re tackling the housing shortage from every angle – investing a further $2 billion in enabling infrastructure, speeding up housing approvals and cutting red tape, and increasing the skilled construction workforce.
- Banning foreign investors from buying existing homes: We’re extending the ban on foreign investors buying existing homes until mid-2029, helping more Australians into homes.
- Making renting fairer and more affordable: We’re continuing our work with the states and territories to get renters a better deal by strengthening renter protections and expanding long-term rental supply. We have also boosted Commonwealth Rent Assistance by more than 50 per cent.
- Backing Australians doing it toughest: We’re supporting at risk young people to get into secure housing and we’re continuing to deliver more social and affordable homes through the Housing Australia Future Fund.
This is about one goal: More Australians in a home – whether they own or rent.
We’re backing this plan with serious investment, lifting our total housing commitment to a record of over $47 billion.
This is the largest and most comprehensive housing plan Australia has seen in generations.
Helping Australians buy a home
It’s too hard for too many Australians to buy their own home and get ahead.
That’s why we’re providing tax relief to workers and giving more Australians the opportunity to own their own home by making our tax system fairer.
We will limit negative gearing for residential property to new builds from 1 July 2027. Arrangements will remain unchanged for all existing investments made before 7:30pm AEST 12 May 2026.
We will replace the 50 per cent capital gains tax (CGT) discount with inflation-adjusted indexation from 1 July 2027, to restore the taxation of real gains, and introduce a minimum tax rate of 30 per cent on realised gains. This will apply to all assets except new homes, where both new and old arrangements will be available. It will be prospective, with gains accrued on existing investments prior to the start date to retain the 50 per cent discount.
Our tax changes will help around 75,000 homeowners into the market over the next decade and are part of a package of housing reforms in this Budget that will boost housing supply.
They will help level the playing field for first home buyers and build on the strong support we are already delivering through the expanded 5% Deposit Program and the introduction of Help to Buy. Together, these programs now mean that more than half of all first home buyers are entering home ownership with the support of the Albanese Government.
Building more homes, more quickly
Building more homes is the main game when it comes to addressing Australia’s housing challenge.
That’s why new builds are exempt from the tax changes, to steer investment toward increasing supply. This means investors purchasing new housing can continue to access negative gearing and can choose between the 50 per cent discount and the new indexation arrangements.
More infrastructure funding
We are investing a further $2 billion in housing enabling infrastructure to address one of the key barriers holding back more housing supply.
This funding will establish a new Local Infrastructure Fund as part of the Housing Support Program, to unlock the enabling infrastructure needed to finish housing projects that otherwise wouldn’t go ahead due to a lack of enabling infrastructure including roads, water, power and sewerage.
This funding will be provided to local governments and state utility providers, with $500 million reserved just for regional Australia.
The Local Infrastructure Fund will support up to 65,000 homes over 10 years.
This $2 billion investment brings our total investment in housing enabling infrastructure to a record $6.3 billion since coming to government.
And we have a further $5.9 billion available to states and territories as part of the 100,000 Homes for First Home Buyers program.
Faster approvals and less red tape
Access to the Local Infrastructure Fund will be linked to further state-based reforms to improve productivity in the housing sector – including faster and simpler approvals, making more land available and ready to build homes, and delivering a genuinely national construction code.
These reforms have the potential to support tens of thousands of additional homes and could reduce regulatory costs by up to $3 billion per year.
We’re also making it easier to build by making all standards referenced in Australian legislation free, including mandatory construction standards, as part of our work to streamline the National Construction Code.
Important regulations should not sit behind a paywall. This change will save builders and tradies up to $1,600 per year.
Building on the momentum of the EPBC strike team set up last August, the Government will provide over $45 million to progress bilateral agreements with states and territories. This will cut red tape and duplication by combining federal and state assessments and approvals, ensuring proponents can benefit sooner from quicker, more efficient environmental approvals, while maintaining strong environmental safeguards.
This is on top of an additional $250 million in this Budget to accelerate and streamline environmental approvals processes, unlocking investment in national priority areas including housing.
More tradies in construction
We’re investing $85.2 million to accelerate skills assessments for skilled migrants in trades industries and to better integrate occupation licensing with the assessment process. Once implemented, this could cut the time taken to enter the workforce by up to 6 months.
The investment will also provide a new pathway for migrant workers already onshore to have existing qualifications and practical trades experience recognised, helping to address workforce shortages.
This builds on our work to train more tradies, through Free TAFE and the $10,000 incentive for apprentices training in the residential housing sector.
These actions build on our comprehensive supply agenda. We have set an aspirational target, with all levels of government and industry, to build 1.2 million homes over five years.
Banning foreign investors from buying existing homes
We’re extending the ban on foreign investors buying existing homes until mid-2029, meaning Australians will be able to buy homes that would have otherwise been bought by foreign investors.
Current limited exceptions to the ban for purchases of established dwellings that support housing supply will continue.
Making renting fairer and more affordable
Renters should be able to experience the stability that makes a house into a home.
That’s why we’re continuing to work with the states and territories to implement National Cabinet’s Better Deal for Renters.
As a result, most states have now banned ‘no grounds’ evictions, limited rent increases to once per year and set minimum rental standards.
Our Build to Rent tax incentives are also helping to unlock more long-term rental housing right across the country.
And we continue to support Australians doing it tough through Commonwealth Rent Assistance. Since coming to government, we have increased Commonwealth Rent Assistance by more than 50% for over 1.4 million Australian households.
Backing Australians doing it toughest
Too many young people, who are at most risk of homelessness, are locked out of social housing due to a structural inequity that makes it harder for Community Housing Providers to house them.
That’s why we’re investing $59.4 million to supplement rental income for Community Housing Providers delivering social housing for over 4,000 young people, aged 16-24, who are in receipt of the Away from Home rate of Youth Allowance or ABSTUDY and who are at risk of, or experiencing, homelessness.
This investment will change lives – helping vulnerable young Australians escape homelessness, addressing intergenerational housing inequality, and easing cost-of-living pressures.
We’re also continuing to roll out our ambitious social and affordable housing agenda, delivering 55,000 social and affordable homes right across the country.
And in this Budget, we are releasing a further $100 million from the Housing Australia Future Fund to improve the quality of housing for First Nations Australians in remote communities.
After a decade of inaction, we’re taking decisive action to boost housing supply and help more Australians into homes.
This Budget is all about resilience and reform, and helping more Australians into homes is an important part of our agenda.