What the major parties are proposing ahead of the 2025 federal election

During the campaigning period, housing affordability has remained a hot-button issue, with both major parties focusing on pledging different policies aimed at improving the pathway for first home buyers.

With the upcoming 2025 federal election set to take place on 3 May, here are the housing-related pledges that have been brought to the table by the major parties.

First home buyer policies

Labor:

The Labor Party has announced that it will revise the First Home Guarantee (FBHG) initiative by enabling all first home buyers to purchase a property with a 5 per cent deposit without having to pay for lender’s mortgage insurance.

Prime Minister Anthony Albanese said that the expanded FBHG initiative will have no caps on places or income and will also offer higher property price limits, although the specific details of these limits have not yet been revealed.

The revision will represent a significant change from the current FHBG scheme, which has 35,000 places available and is only available to singles earning less than $125,000 per year and couples with a combined income of up to $200,000 annually.

Additionally, the Labor Party has announced that it will make a $10 billion investment to build 100,000 homes in cooperation with state developers, which will only be available to first home buyers.

Alongside the expanded FBHG initiative, the Labor Party said it will also continue to operate the Help to Buy shared equity scheme, which will offer expanded income and price caps to eligible buyers, as previously outlined in the 2025–26 federal budget.

Coalition:

The Coalition has pledged to allow first home buyers to access up to $50,000 – or up to 40 per cent – from their superannuation when purchasing their first property, which will apply to both new and existing homes.

To ensure the financial stability of a home buyer later in retirement, Opposition Leader Peter Dutton stated that any money initially withdrawn from superannuation will need to be repaid when the home is sold, including a share of any capital gains.

The Coalition has also promised that its First Home Buyer Mortgage Deductibility Scheme will enable first home buyers to claim a tax deduction on the interest paid for the first $650,000 of a mortgage for a newly built home.

The scheme will be available to individuals earning up to $175,000 and joint applicants earning up to $250,000, allowing participants to continue accessing the tax deduction even if their income increases.

Although there will be no cap on the overall mortgage size or home price in the scheme, the measure will only apply to newly built homes that have been purchased as a principal place of residence.

An elected Coalition government will also introduce an expanded Home Guarantee Scheme, which will increase the income cap from $125,000 to $175,000 for individuals and from $200,000 to $250,000 for joint applicants, and raise property price caps nationwide.

The Coalition also pledged to remove placement limitations for both the First Home Buyer Guarantee and Regional First Home Buyer Guarantee components of the broader scheme.

Housing supply

Labor:

The Labor government noted that if elected on 3 May, the party would remain committed to the National Housing Accord target of building 1.2 million homes by 2029.

The Labor Party said that to hit its target, it would look to fast-track the implementation of a national Housing and Homelessness Plan that aligns the policies and investments of all levels of government to increase housing supply.

To further ease pressure on the housing market while building additional homes, the Labor government also announced that it would prohibit foreign purchases of established dwellings from 1 April 2025 to 31 March 2027, with a future review to determine whether this policy should be extended.

The Labor government has also reaffirmed its intention to maintain current taxation settings to encourage investment in build-to-rent developments.

The party has confirmed that it will continue to operate the Housing Australia Future Fund (HAFF) and National Housing Accord Facility (NHAF) investment funds, which were passed through Parliament in late 2023, and together aim to deliver a total of 30,000 social and affordable homes.

Coalition:

On the other hand, Dutton has pledged to shut down the HAFF, but said his government would still honour any contracts entered into under the previous Labor administration, if elected.

Instead of continuing the Labor government’s rental housing programs, the Coalition has pledged to implement policies that will increase housing supply and subsequently unlock home ownership for more Australians.

The Coalition has announced that it will deliver up to 500,000 new homes nationwide through its $5 billion Housing Infrastructure Program.

Dutton has also stated that, if elected, the party would clear the residential development backlog within 12 months.

To further bolster the delivery of new homes, the Coalition also promised to freeze any changes to the National Housing Construction Code for 10 years, cutting through the obstacles to construction that currently inhibit the sector.

Additionally, Dutton pledged to implement a two-year ban on foreign investors and temporary residents purchasing existing homes in Australia.