With just weeks to go before the 2025 federal election, the housing crisis has taken centre stage in the campaigns of both major political parties. Over the weekend, the Liberal and Labor parties launched fresh policy proposals aimed squarely at younger voters and suburban families — two groups that have been hit hardest by skyrocketing property prices and dwindling housing supply.
Labor returned to Perth to unveil its latest housing plan, while the Liberals chose Western Sydney as the backdrop for their campaign revival. Both launches made clear that housing affordability has become a key battleground — and both sides are making bold pitches to win over first-home buyers.
Among the headline announcements, Opposition Leader Peter Dutton revealed a new tax offset of up to $1,200 for low- and middle-income earners, reversing earlier suggestions that such a measure was off the table. The Coalition also introduced a policy allowing first-home buyers to deduct mortgage interest (up to $650,000) from their taxable income for the first five years of owning a new home — provided they live in it the whole time.
The Labor Party countered with a plan to build 100,000 new homes specifically for first-home buyers, while also removing income and property price caps from its existing 5% deposit guarantee scheme. This comes on top of its already promised $33 billion investment to support the construction of 1.2 million new homes over five years — a target many experts say is falling behind schedule.
However, while the promises may be new, public confidence in their effectiveness is low. Independent economist Saul Eslake warned that both parties’ policies could further inflate home prices. He was especially critical of the Liberals’ combination of superannuation access and interest deductibility, calling it a contender for “the worst policy decision of the 21st century.”
Critics also note that many of the proposed reforms — particularly those related to infrastructure and planning — are dependent on cooperation with state and local governments, which often slows progress. And while the tax offset and housing incentives may sweeten the deal, some voters remain skeptical, seeing them as last-minute moves in a high-stakes policy auction.
Both parties hope their new initiatives will resonate, especially with younger Australians still chasing the “Great Australian Dream.” But for many, these announcements may feel like more of the same: big promises, with uncertain delivery.
