Albanese Defends Housing Tax Changes, Says Reforms Aim to Help First Home Buyers

The Prime Minister says changes to property investor tax concessions will reduce competition for first home buyers, as the Government faces pressure to address housing affordability.

CANBERRA, Australia — Prime Minister Anthony Albanese has defended the Federal Government’s housing tax reforms, arguing that changes to property investor tax concessions are intended to make home ownership more accessible to Australians struggling to enter the property market. In a statement published on social media, Albanese said changes introduced by the Howard Government in 1999 had given property investors significant tax advantages, contributing to a housing market that had become increasingly difficult for first home buyers.

He argued that the tax system had encouraged property investment while making it harder for younger Australians and families to purchase their first home. “Between 1999 and 2026 the average house price rose by over 400%,” Albanese said, adding that prices had increased more than twice as fast as average incomes. The Prime Minister said the rising cost of housing had left many Australians concerned they might never be able to afford a home of their own.

Government targets property tax concessions

The Albanese Government announced changes to negative gearing and capital gains tax in its 2026–27 Federal Budget, with the reforms intended to improve housing affordability and encourage investment in new homes. Under the changes, negative gearing for residential property investments will generally be limited to new builds from July 2027. The Government has also legislated changes to the capital gains tax discount, replacing the existing 50 per cent discount with inflation-adjusted indexation and a minimum tax rate on relevant capital gains.

Existing investments acquired before the announced commencement threshold are covered by transitional arrangements. The Government says the reforms are designed to reduce the tax advantages associated with investing in established residential properties while encouraging investment in new housing construction.

More details are available in the Australian Treasury’s tax reform announcement.

First home buyers and investor activity

Albanese said Australian Bureau of Statistics (ABS) data showed first home buyers were facing less competition from property investors following the Government’s tax changes. The ABS reported that the number of new investor housing loan commitments fell by 8.6 per cent in the June quarter of 2026, while first home buyer loan commitments fell by 2.9 per cent over the same period. The figures show that investor and first home buyer lending both declined during the quarter. They do not, on their own, establish that the tax reforms caused the changes or directly measure competition between investors and first home buyers. The ABS also reported that total new housing loan commitments fell by 5.4 per cent during the quarter.

Source: Australian Bureau of Statistics, Lending indicators, June quarter 2026.

Five per cent deposit scheme

The Prime Minister also highlighted the Government’s support for first home buyers through its low-deposit home ownership program. Albanese said 280,000 Australians had been helped to purchase their first home with a deposit of just 5 per cent. The program is intended to help eligible buyers enter the housing market without having to save a traditional 20 per cent deposit, although eligibility requirements and the cost of purchasing a home remain important considerations. The Government has also committed to increasing housing supply, including through programs supporting social and affordable housing.

Housing affordability remains a major challenge

The Government’s reforms come amid continuing concerns about rising property prices and the difficulty many Australians face in saving for a deposit. Albanese said the changes were part of a broader effort to address what he described as an unfair housing system.“For too long, Australians faced a housing system stacked against them,” he said.

The Government maintains that its tax reforms, housing construction measures and first home buyer support will help more Australians achieve home ownership. The long-term impact on house prices, rents, housing supply and first home buyer access will depend on how the reforms affect investor behaviour and the construction of new homes.