‘Dangerous’ policy changes to bring investor exodus

Similarly, the survey found that more than one-third of investors would pull out of the market if capital gains tax (CGT) concessions were reduced to 25 per cent.

Currently accounting for more than 90 per cent of rentals, PIPA chair Cate Bakos said that Australia’s rental system has relied heavily on investors for supply, and that actions to deter them from entering the property market would see renters pay the price.

“Investors have quietly carried the weight of Australia’s rental supply for generations,” Bakos said.

“Any policy shift that undermines their confidence risks shrinking the pool of available homes at the very moment renters can least afford it.”

With the latest SQM Research data showing that national vacancy rates have fallen to just 1 per cent, Bakos said any policy changes should support investors in increasing housing supply rather than restrict it.

“Reform should reward the investors who hold property for the long haul and contribute to stable rental availability,” she said.

“We cannot afford settings that push them out of the market or encourage short-term speculation.”

When it comes to government impacts on investors through land tax, levies, and stamp duty, Western Australia and Queensland were considered the most “pro-property investment” states.

Conversely, investors identified Victoria as the least accommodating state for investment, followed by ACT and NSW, with all three described as “anti-property investment”.

Despite Victoria being unfavoured by investors, over 40 per cent of respondents said they believed Melbourne was the best place to buy right now, more than double the 16.5 per cent who said Brisbane was the next-best option.

Interestingly, not a single survey respondent picked Canberra as a good place to invest in property.

Following the survey results, PIPA has called on the government to retain CGT and negative gearing in their current form and to prioritise solutions that address the structural undersupply of housing.

Bakos said that the nation needed to ensure that any property tax changes did not deter future investors from entering the market.

“Blaming investors for price pressures is not just inaccurate – it’s dangerous.”

“It distracts from the real issues and risks triggering decisions that make the rental crisis even worse.”

“We need long-term thinking, evidence-based policy, and a commitment to boosting supply – not measures that risk driving investors away,” Bakos concluded.

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• Negative gearing
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• CGT

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