‘Victorian Labor is making the housing crisis worse’

The Victorian Labor government has been accused of worsening the state’s housing crisis through its ‘punitive property taxation environment’.

Victorian Premier Jacinta Allan has come under fire over her government’s tax burden on the state’s property industry. Picture: David Crosling.

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The Allan Labor government has been accused of worsening the state’s housing crisis through its “punitive property taxation environment”, after a new survey found the property industry’s confidence in the government’s ability to manage and plan for ­future was at a record low.

The latest industry sentiment survey by Procore and the Property Council of Australia found the Victorian government’s net performance index had plummeted to 54 points below neutral, 14 points lower than the December 2024 result and its lowest score since the quarterly survey began 14 years ago.

The March survey of 1170 Property Council members shows that while overall industry confidence in Victoria has increased since the February interest rate cut, it was still well below other Australian jurisdictions.

Property Council Victorian executive Director Cath Evans said the Allan Labor government’s taxation regime was gutting investment and worsening the state’s housing supply.

“This new survey sounds alarm bells on Victoria’s punitive property taxation environment, with 54 per cent of survey participants citing property taxes and charges as the most critical issue for the industry,” Ms Evans said.

“Despite significant reform to help fast-track Victoria’s planning process, the government’s eye watering stream of taxes are putting a brake on project feasibility and delivery.

“These taxes aren’t just killing off homes, they’re crushing the feasibility of much-needed new commercial projects that would generate new Victorian jobs.”

Ms Evans called on the Allan government to deliver tax relief for the property industry in next month’s state budget, a position that was echoed by the Victorian opposition.

“With strong population growth and more effective planning than many other states, we still have the chance to bring back investment quickly if the government provides a step change on property tax,” Ms Evans said.

Opposition Treasury spokesperson James Newbury said Labor’s “relentless tax raids” were driving investment out of Victoria, while opposition planning and housing spokesperson Richard Riordan said “continued tax and regulatory attacks” on property owners and the private construction industry had shattered confidence in the government.

“In the middle of a housing crisis, we’ve got 20 per cent of newly built homes sitting unsold and property investors fleeing the state,” Mr Riordan said.

“Victoria has become a confidence-free zone – and it’s renters, homebuyers and jobseekers who are paying the price.”

Asked about the survey results on Thursday morning, Ms Allan said while she hadn’t yet seen the figures, Victoria was a “great place” for investment.

“My message to the Property Council is absolutely clear: here in Victoria we are the state that is building, approving and completing more homes than any other state,” Ms Allan said.

“We are a great place to invest, we have higher business investment than other comparable states. We have pipelines of projects like the Suburban Rail Loop, like the North East Link, that are opening up new places and spaces for people in the property industry to come in and invest and make the most of those opportunities that come from having great, strong transport connections.

“When I talk to the property industry, which I do regularly, that’s exactly the feature of those conversations.”