Albanese’s First-Home Buyer Policies Face Growing Backlash

Weasel words 

Before the last election, Anthony Albanese urged young Australians to enter the housing market with a five per cent deposit. Soon afterwards, he changed tax settings in a way that helped weaken the value of the homes many had just purchased.

This government has produced plenty of contenders for its most cynical policy failure. This one ranks among the worst.

First-home buyers who exhausted their savings, borrowed close to the full purchase price and accepted the government’s message that “now is a good time to buy” have found themselves with negative equity in their new homes.

Interest rates continue to climb, while buyers are turning away from the property market and towards other asset classes following changes to capital gains tax and negative gearing rules.

Even if Labor’s broken promises on property taxes eventually help hold down prices for future first-home buyers, the tens of thousands who used Labor’s deposit scheme have been badly let down by Albo’s backflips.

“If you’re looking to buy your first home, Labor’s got your back,” the Prime Minister declared at his campaign launch in April 2025.

Before the election, Albanese was directly asked whether he could rule out changing negative gearing and capital gains tax settings if Labor returned to office.

“Yes. How hard is it? For the 50th time.”

It was an emphatic and impatient response, delivered as though the repeated question itself was offensive.

After the election, Labor expanded its five per cent deposit scheme by removing income caps, making places unlimited and increasing property price limits.

Albo said the changes “will open the door to thousands more buyers, helping them save money and get their keys faster”.

Only six months later, Labor’s budget announced changes to negative gearing and capital gains tax that made investing in established housing less attractive.

Young Australians were first encouraged to borrow heavily to compete for homes. The government then altered the investment settings that supported demand for those same properties.

That amounted to a profound breach of trust.

The Reserve Bank’s latest financial stability review draws the link clearly. Changes to tax settings, combined with higher interest rates, have contributed to falling housing prices. Recent buyers with large loans relative to their property values — particularly those in the five per cent deposit scheme — are now at heightened risk of negative equity.

A relatively modest market correction can wipe out years of saving. The mortgage, however, remains payable, and rising interest rates make meeting those repayments more difficult.

The government guarantee that allowed buyers with minimal deposits to enter the market just before it began to fall protects the banks that provided the loans, not the homeowners. If foreclosures follow, taxpayers will carry the cost.

There is a strong argument for reforming housing taxation. More affordable homes would help Australians still waiting to buy, and governments cannot promise that property prices will rise indefinitely.

But none of that excuses encouraging people to enter with minimal equity, having emphatically ruled out tax changes, then reversing those assurances months after expanding the scheme.

If Labor believed its tax reforms were necessary, it should have explained its intentions before asking voters to endorse its housing package.

Instead, voters got the attractive announcement before the election and the uncomfortable consequences after it.

When Albo was asked whether his earlier assurances were promises, he offered this distinction: ‘They were statements and we have changed our position.’

Weasel words.

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A government can change its position, but a young couple with a newly settled mortgage can’t hand back the keys and retrieve their deposit because the Prime Minister has found a new policy preference after votes have been cast.

Negative equity needn’t force someone out of their home. Most borrowers are keeping up with their repayments, and buyers who can hold on may eventually recover their losses.

But life doesn’t always accommodate such a long-term investment horizon. Certainly not as the unemployment rate rises and fears of a recession abound.

People lose jobs, relationships break down, rising interest rates squeeze family budgets. People can be forced to relocate for work.

Selling a home worth less than the outstanding mortgage can leave people already doing it tough with debts even once the property is gone.

Albo’s reckless disregard for keeping his word has enabled such a dire outcome for many who trusted what he promised.

The PM understood the importance of protecting existing investors such as himself when setting the new property tax rules. He allowed for grandfathering of negative gearing, for example.

But he offered no equivalent protection for the equity of first homebuyers he encouraged into the market right before he changed the market rules.

Albo’s royal favours

The PM’s arrogance extends to thinking that parliamentary staffing allocations are the equivalent of royal favours he can bestow on grateful subjects. Unfortunately, his generosity comes out of taxpayers’ pockets.

Albo offered One Nation MP David Farley an extra adviser with a salary of $200,000 a year. The offer was entirely unsolicited.

‘I have determined that you be allocated an adviser,’ Albo’s letter declared. Farley rejected it; Pauline Hanson virtually declared it tantamount to a bribe. Either way, it comes in the wake of repeated prime ministerial rejections of One Nation requests for staffers it’s entitled to within the leaders’ office now that the minor party has more than five parliamentary seats.

That’s the threshold for official party status. The Greens also qualify, and Albo has given them 15 staffers as a consequence. How many have been awarded to One Nation? Precisely zero, at the PM’s ideologically biased discretion.

Hanson’s team says the additional staff would help organise visits, coordinate security and liaise with the Australian Federal Police to ensure the safety of the One Nation leader and those in her orbit.

These are practical arrangements supporting the protection of elected representatives, but Albo doesn’t care. His office is no longer even bothering to respond to Hanson’s requests.

But somehow an unsolicited allocation for one of her MPs, who doesn’t need the extra staffer, gets immediate approval.

Meanwhile, Senator Fatima Payman, who left Labor for the crossbench, remains without a personal adviser despite repeatedly requesting one.

The Payman snub is even more of a reflection of Albo’s hypocrisy in that Tammy Tyrrell has been permitted to retain her two additional advisers after defecting from the crossbench to join Labor.

What consistent principle explains that? It’s just Albo playing partisan political games. Those who defect away from Labor get shafted, those who defect to it get rewarded. The only reason Albo is courting Farley with extra resources is because of the rumours that he’s a chance of defecting from One Nation.

The grubby politicking by Albo continues.

Of course, the PM’s own office has no less than 59 personal staffers. We have seen what some of that taxpayer-funded capacity produces: a dirt sheet targeting Helen Haines, after she questioned funding for his local golf club.

When I sent questions about that dodgy practice to Albo’s head of communications team, she didn’t even bother to answer them. Perhaps too busy pulling together other dirt sheets on political opponents.

Staffing should be independently allocated according to parliamentary responsibilities and needs. Political opponents shouldn’t have to petition the Prime Minister like subjects seeking royal favour.