Negative gearing changes a ‘distraction’ and waste of time

A broader set of reforms to increase efficiency in the economy and increase the supply of new homes, is the suggestion to the next government from the industry group.

It comes after the Greens this week vowed to abolish the property loophole, which allows investment property owners to offset ‘losses’ from maintaining rentals for tax efficiency.

The Greens say both negative gearing and capital gains tax discounts will be reassessed should they be successful gaining power in a minority government at the 2025 federal election.

PCA chief executive Mike Zorbas says the Greens’ plan – while designed to recalibrate the unaffordable housing market and reign in investors – is more likely to be a “distraction” from effective policy.  

“The next Australian government will need a laser focus on both supply and market confidence,” he said. “We are in the middle of a housing crisis and the only way to get out of it is to build more homes.

“Tampering with negative gearing will only lower the supply of new homes.”

Property Council of Australia chief executive Mike Zorbas warns tampering with negative gearing is a distraction. Picture: Property Council of Australia

Mr Zorbas said any the housing gap was likely to be widened further by the band-aid solution to curb investment.

“Serious housing policy needs to tackle the myriad pressures in the housing market from labour shortages, high construction costs, complex tax regimes and lengthy planning systems against the backdrop of unusual global uncertainty,” he added.

“Over the next twelve months individuals and institutions will be looking for leaders who give them the greatest possible certainty of investment in new supply.”