Australia elects first Labor government in nine years

Mortgage and property industry leaders in Australia are welcoming the incoming Labor government, with Anthony Albanese sworn in as the country’s 31st Prime Minister.

Labor is poised to form a majority government in Australia after winning a slew of seats. Teal independents and Greens candidates have also won an unprecedented number of seats in a devastating defeat for the Coalition government.

It marks the first time in 15 years that Australia and New Zealand will both be ruled by Labor governments at the same time. In Australia, the party is spelled “Labor”, rather than “Labour” in New Zealand.

The last time the countries both had left-wing leaders was in 2007 when Helen Clark was NZ prime minister and former Kevin Rudd was Australian PM.

The Australian Labor Party (ALP) is set to govern for the fourth time since WWII, after being in Opposition for nine years.

Incoming Prime Minister, 59-year-old Anthony Albanese, has pledged a boost to the minimum wage, cheaper childcare, strengthened Medicare and a renewed focus on climate change. 

Further details of Labor’s Help to Buy scheme are now expected, enabling up to 10,000 Australians per year to buy a home with a government contribution of up to 40% of the purchase price.

Read more: Why Labor’s help to buy housing scheme needs work 

Specialist Finance Group (SFG) aggregation manager Blake Buchanan (pictured above left) said as a growing number of Australians had become disenfranchised with the state of politics, and with the Coalition and the ALP, he was “totally unsurprised” at Labor’s victory.

Both major parties had significant swings against them, with teals and smaller political parties winning more shares of the vote than in the past.

 “This should send a message to both parties and the powerbrokers within that change is necessary,” Buchanan said.

Unlike in 2019, when a high number of finance brokers and their families voted for the Coalition for “their own survival”, for Buchanan, 2022 was the first election that would not result in a “win” or “lose” outcome.

On Saturday, Australians, including the mortgage broking industry could “vote with their conscience,” and not for a team they felt obliged to vote for, he said.

Faced with unprecedented economic and social challenges, Buchanan does not expect leading the country to be an easy road ahead.

“I hope both major parties take the next 3 years to rebuild the way they represent and communicate with their constituents and do it more collaboratively with the stakeholders,” Buchanan said.

With annual inflation in Australia at 5.1% and expected to rise further, the government needed to address the cost of living.

“I am worried that not enough is being done about our current and forecast cost of living pressures that if unaddressed will see us closely follow the US into what looks to be an unavoidable recession,” Buchanan said.

Read more: Could inflation tip the economy into ‘stagflation’?

Infinity Group Australia director Graeme Holm (pictured above right) said increased demand from Labor’s proposed Help to Buy scheme could have an upward effect on house prices.

“In summary I don't feel professionally this will help housing affordability but rather inflate house prices across both new and existing [properties], Holm said.

“Although only being 10,000 places, the scheme will encourage purchasers to spend more, having a smaller debt to manage.”

Property Investment Professionals of Australia (PIPA) chair Nicola McDougall (pictured) said as national supply of rentals is at “record lows,” addressing the current rental crisis in Australia should be among the priorities of the incoming Labor government.

Labor’s Help to Buy scheme was a potential way for some low-to-middle income earners to buy homes. But McDougall had concerns around how homeowners taking up the scheme would move up the property ladder.

 “I am concerned about a homeowner being able to upgrade to a bigger home in the future, since they will be required to pay back the government’s initial equity stake, plus capital gain, if using the Help To Buy program. Their first home might in fact be their last,” McDougall said.

Labor’s pledge to build 30,000 new social and affordability housing properties over the next five years (6,000 per year) is a “drop in the ocean” compared to what would be required to house Australia’s current and future population, McDougall said.