Ray White slams Budget for forgetting about renters and threatening new supply

It is a policy that will make the housing crisis worse, and Australia's most vulnerable renters will pay the price.

By seeking to reduce house prices in the established market to benefit first home buyers, the Federal Government has forgotten about renters and puts housing supply at risk.

There are 2.9 million households who rent their homes. Some will benefit from a drop in house prices to buy their home, but many will now be nervous about what these changes will mean for them.

Why would an investor buy a new build knowing they can only sell to an owner-occupier? When it comes to selling, their buyer market is cut in half. Investors will pivot to other asset classes - the consequences are entirely predictable.

From our experience, most investors can't afford new property. They buy established property because they are priced out of new. This equation won't change after the budget.

We are experiencing record rental growth across Australia (44 per cent over the past five years), and now the Federal Government is forcing renters into more expensive new houses and apartments. How are they going to afford that?

Limiting negative gearing to new builds assumes rental supply is interchangeable. It is not. A brand new apartment in an outer growth corridor does not replace a rental home near a school, hospital or train line. Regional markets are even more exposed, many simply don't have the development pipelines to absorb this kind of policy shock.

Ray White supports genuine housing supply solutions, we have been calling for them loudly for years. But restricting investment in established housing and increasing taxes on new does not put a single new home in the ground any faster. The government's own $2 billion infrastructure fund is spread across 10 years. In that gap, real people need real rental housing. Pulling investors out of the market today, while waiting for supply that arrives in a decade, is not reform. It is a gamble with other people's lives.

Australians deserve a tax system that grows housing supply, supports investment, and keeps rents affordable.

What they are getting instead is ideology dressed up as reform.