Housing affordability a top voter concern, says MFAA
Australia’s two major political parties have released new proposals aimed at improving access to home ownership, with a particular focus on first-home buyers.
The Labor Party has pledged to expand the federal government’s home guarantee scheme, allowing all first home buyers to purchase a property with just a 5% deposit. The party also plans to invest $10 billion in the construction of up to 100,000 new homes dedicated exclusively to first home buyers.
According to Mortgage & Finance Association of Australia (MFAA) chief executive Anja Pannek (pictured above), housing affordability has become a key issue for voters.
“The major parties are clearly recognising housing affordability and access to home ownership as key issues for voters – particularly first-home buyers – in this election,” she said.
Labor’s proposal includes removing income and placement caps for the scheme, potentially making more Australians eligible. Pannek noted that many prospective buyers exceed traditional income limits yet still face significant hurdles entering the market. “Increasing property price caps responds to rising home values, particularly in capital cities, and better aligns the scheme with actual market conditions,” she said.
Pannek also welcomed the planned home-building initiative but cautioned that success would depend on implementation. “It’s important to see the detail – particularly where and how fast these homes will come online, and how affordability will be maintained,” she said.
The Coalition has responded with its own set of housing policies, including a proposed tax deduction for mortgage interest payments over the first five years of a new-build home purchase by a first-time buyer. The Coalition also intends to increase income and property price thresholds for the Home Guarantee Scheme and remove the cap on available placements under the First Home Buyer and Regional First Home Buyer guarantees.
Pannek said the tax deduction would offer relief during the early stages of a mortgage. “It could help with cash flow in the critical early years of a loan,” she said.
She also noted that the Coalition’s changes would bring its scheme in line with Labor’s proposal. “The increase in price caps in high-demand areas is welcome – but the rise must be accompanied by supply-side activity to avoid fuelling further price growth,” Pannek said.
She stressed the importance of looking at these new proposals in the broader context of ongoing housing initiatives. “Any policy that helps Australians into their first homes is welcomed by the MFAA, especially as they face higher barriers to entry – including high cost of living which affects serviceability, and increasing property prices in most states which means large deposit requirements,” Pannek said.
The MFAA has submitted its own policy recommendations to the federal Inquiry into the Financial Regulatory Framework and Home Ownership, emphasising the need for increased housing supply. “While buyer-side incentives are useful, they must be paired with policies that accelerate housing construction and release of appropriate land,” Pannek said.
She added that the timing of policy implementation is crucial. “Implementation and speed matter. Whether homes are built, deposits reduced, or tax deductions granted, the real test will be how quickly these policies deliver practical outcomes.”
Pannek also reiterated the MFAA’s position on tax reform, calling for broader changes including a potential review of stamp duty. “We’re disappointed not to see broader tax reform on the table – for example working with the states to review stamp duty, which we know not only increases property acquisition costs but places a barrier to efficient property market activity,” she said.
She acknowledged the complexity of the current home ownership system, which now includes various grants, schemes, and tax measures. “Mortgage brokers are best placed to help home buyers make sense of these changes and tailor a path to home ownership that reflects their personal circumstances,” Pannek said.
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