The Real Estate Institute of Australia (REIA) has reviewed the Labor Government’s 2025-26 Budget, analysing its impact on the real estate sector. While REIA President Ms Leanne Pilkington acknowledged the government’s commitments to housing supply and affordability, she stressed that further measures are necessary to tackle ongoing market challenges.

Ms Pilkington pointed out that the Budget projects a $27.6 billion deficit for 2024-25, with GDP growth expected to reach 1.5% in 2024-25 and 2.25% in 2025-26. Inflation is anticipated to ease to 2.5% by mid-2025, within the Reserve Bank’s target range. “Although these economic indicators suggest stability, the path to sustained improvements in affordability requires ongoing government intervention and collaboration with the industry,” Ms Pilkington said.

Ms Pilkington said dwelling investment is projected to grow by 1.5% in 2024-25, with stronger growth expected in the years following. The Government’s $33 billion housing investment, which includes a target of 1.2 million new homes over five years, is seen as a positive step. However, Ms Pilkington said that challenges remain, particularly with labour shortages and regulatory barriers that continue to delay construction.

“Key initiatives supported by REIA include an $800 million expansion of the Help to Buy scheme, increased funding for social and affordable housing, and backing for prefabricated and modular home construction.

“Renters will also benefit from the retention of a 45% increase in the maximum Commonwealth Rent Assistance, alongside the introduction of the “A Better Deal for Renters” policy.

While these measures provide immediate relief, Ms Pilkington called for long-term structural reforms to improve rental supply. “The Budget also includes provisions to boost the construction workforce, such as doubling incentive payments for housing apprentices and expanding Free TAFE enrolments. These initiatives are designed to address labour shortages and strengthen industry capacity.”

While REIA supports these efforts, Ms Pilkington urged the Government to streamline planning approvals, reduce red tape, and incentivise private sector investment in build-to-rent projects to ensure the long-term sustainability of housing supply.