The Australian government spent billions more on tax breaks for property investors, last year, than it did on social housing, homelessness services and rent assistance combined, research by the Australian Council of Social Service (ACOSS) has found.
“This report shows housing stress and homelessness are getting worse while absurdly generous tax breaks drive up home prices and supercharge inequality in our society,” ACOSS acting CEO Jacqueline Phillips said on January 30.
ACOSS reports that tax breaks for investors, such as the capital gains tax (CGT) discount and negative gearing, cost a whopping $12.3 billion last year. Almost 60% of the benefits of these tax breaks go to the richest 10% of people.
Negative gearing allows investors to use the cost of maintaining their empty properties as a tax write-off, even if the property is increasing in value.
Investors can hold onto these empty properties — creating an artificial housing shortage — knowing that when they decide to sell, they will receive a 50% CGT discount. Or, in the other win-win situation for landlords, they can rent out their properties, taking advantage of landowner-friendly rental laws and soaring rent prices.
The tax breaks help rich people accumulate more investment properties — while ordinary people struggle to find an affordable roof over their head — and speculate on the basic human right of housing to make themselves richer. Australian Taxation Office data reveals that just 1% of taxpayers own a quarter of all investment properties in the country.
Government policies allowing unchecked speculation and for-profit housing mean that Australia consistently ranks among the least affordable countries in the Organisation for Economic Co-operation and Development.
Meanwhile, state and federal governments have abandoned any commitment to building public housing, much of which they have sold off or converted to “social” housing — a privatisation by stealth that is more expensive, with less rights and security for tenants.
Even then, social housing made up less than 2% of new dwellings built last year, compared to 15% in the 1970s, according to ACOSS.
This year’s Productivity Commission Report on Government Services found that 41% of people on the public housing waitlist are homeless or at risk of homelessness — up from 26% in 2015.
Meanwhile, severe rental stress — people paying more than 50% of their income on rent — among people receiving Commonwealth Rent Assistance has more than doubled from 8.1% in 2004 to 18.3% last year.
The Anthony Albanese government has proposed its $10 billion Housing Australia Future Fund as the solution to Australia’s housing crisis.
However, the investment fund is basically a hand-out for developers and, even in a best-case scenario, would produce a pitifully small amount of social and “affordable” housing.
Labor announced on February 4 that it will be looking to sell off 67 defence department properties — such as golf courses, old army barracks and beachside real estate — to raise about $1.8 billion for further military spending. Much of this land could be used for public housing, parks and other facilities for local communities, instead of being sold off to developers.
Instead, Labor, the Liberals and racists, such as Pauline Hanson, are peddling the lie that migrants and the associated population growth are to blame for the housing crisis. By this logic, housing affordability should have improved during Australia’s COVID-19 lockdown, when inward migration was basically zero. However, house prices went up 20% in just 18 months.
What’s more, housing supply has consistently outstripped population growth for decades, which negates the lies that “red tape”, local councils and building regulations are holding back housing affordability.
The lack of genuinely affordable housing is the problem, not housing supply itself.
But without significant grassroots pressure, the political establishment will do nothing to change the investor-friendly housing system — in which about 60% of federal politicians own one or more investment properties — or hurt the profits of its greedy developer mates.
Unlike them, Green Left has always stood on the side of renters, public housing tenants and all those struggling to get by in Australia’s for-profit housing system.
We counter the lies and false solutions around housing promulgated by developers and governments and we report on the many grassroots campaigns fighting for genuinely affordable, secure housing. If you like out work, please become a regular supporter or donate to our 2026 Fighting Fund.