Canberra Property Rebound Hampered by Tax Concerns
Property Council ACT & Capital Region Executive Director Ashlee Berry said while conditions had improved, ongoing tax uncertainty could impact investment and slow essential housing supply.
“The data shows the property sector is bouncing back, with more jobs and projects on the horizon. But Canberra remains one of the most heavily taxed property markets nationally, and this continues to cast a long shadow over the sector’s ability to build momentum,” Ms Berry said.
“Developers need clear and predictable tax settings to bring more homes to market. Efforts to streamline planning and encourage medium-density housing are welcome steps, but without a balanced tax system, developers face ongoing uncertainty that could slow the housing pipeline.
“Lease Variation Charges (LVC) remain a significant barrier to investment, and while recent concessions for build-to-rent are a step forward, their broader application continues to undermine infill housing projects like townhouses and low-rise apartments.
“If the government is serious about delivering more housing choice, it must consider a more strategic approach to development charges,” she said.
The survey found confidence in the ACT Government’s management of planning and growth remains deep in negative territory, with rising property charges flagged as a key and growing concern for respondents.
“Housing affordability is a serious issue in Canberra, and taxation plays a huge role in shaping market outcomes. If the tax settings don’t align with housing supply goals, we risk creating further obstacles to development at a critical time when more homes are needed.”
With Canberra’s population projected to reach 784,000 by 2060, the Property Council urged the government to review property taxes in the June Budget, including Lease Variation Charges, to support investment and accelerate housing delivery.
“Canberra’s future depends on getting the balance right. We need a tax system that encourages growth and supports housing supply – not one that makes it harder to build,” Ms Berry said.
The latest Property Council of Australia/Procore Industry Sentiment Survey shows hiring expectations rose from +16 to +19 and future work pipelines surged from +16 to +39. Office property values sank into negative territory, from +4 to -3. Zero is considered neutral. Confidence grew from +116 to +125, where 100 is considered neutral.
https://www.propertycouncil.com.au/media-releases/tax-casts-shadow-over-canberra-property-bounce-back