Clare O’Neil rejects housing market ‘tanking’ claims as Michaelia Cash warns Labor reforms are ‘crashing’ it
Labor is facing fresh heat over its housing reforms as builders report falling sales and warnings of a deepening downturn grow louder.
Housing Minister Clare O’Neil has rejected suggestions Australia’s housing market is “tanking” as Michaelia Cash declared it was doing exactly that, accusing Labor of refusing to acknowledge mounting pressure on home builders.
The pair clashed over the state of the property market on Sunrise on Wednesday as fresh industry figures showed new-home sales had fallen sharply in the months since the Federal Budget.
Pressed by Natalie Barr on whether she was concerned the market appeared to be “tanking”, Ms O’Neil rejected the characterisation.
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By continuing you agree to our Terms and Privacy Policy.“Well, I don’t agree with that language at all, Nat,” she said.
The Housing Minister instead pointed to rising housing approvals, arguing there were encouraging signs Labor’s controversial housing reforms were beginning to redirect investment towards new supply.
“We’ve got housing approvals in Australia up more than 8 per cent. That’s the third year in a row that housing approvals have lifted, you know, quite substantially. They’ve gone up 26 per cent since the National Housing Accord began,” she said.
But Ms Cash painted a dramatically different picture, pointing to Housing Industry Association figures showing new-home sales fell about 20 per cent across the three months to August.
“I think the question for Anthony Albanese and Clare O’Neil is this how much more pain do Australians need to feel before you actually admit that your housing taxes are actually crashing the housing market?” she said.
“New home sales down 20 per cent. They’re actually now at an all-time low. Builders are actually going broke. Rents are soaring.”
The Coalition has blamed Labor’s Budget changes to negative gearing and the capital gains tax discount for weakening investor confidence and has pledged to reverse them.
The reforms, due to take effect from July 2027, restrict negative gearing on residential properties to new builds while grandfathering properties held before the Budget announcement. Changes to the CGT discount will also apply, although investors purchasing new builds will retain access to the existing 50 per cent discount.
Ms O’Neil argued the downturn could not simply be attributed to the tax overhaul, pointing to three interest rate rises and insisting borrowing costs remained one of the biggest influences on construction.
“The biggest driver of how many homes get built from year to year is actually what goes on with interest rates,” she said.
She also rejected suggestions industry sales figures proved Labor’s strategy was failing.
“I’m really respectful of the property industry who have come forward with these numbers, but I’m just telling you that they don’t paint the full picture,” she said.
Ms Cash remained unconvinced, declaring the Coalition would unwind the changes.
“You do not solve, Nat, the housing shortage in Australia by taxing the housing market and making investment less attractive,” she said.
The increasingly bitter argument comes as the Government faces pressure to demonstrate its reforms can simultaneously make home ownership more accessible while increasing desperately needed housing supply.
