Megaphone Solutions: Why Policy Noise Isn’t Fixing the Housing Crisis

As we inch closer to the next election, housing has become the hot-button issue every political party wants to be seen tackling. But when you cut through the headlines, media soundbites, and conveniently timed “solutions,” you start to realise a hard truth:

We’re still talking about the same problems with no real progress.

Recently, Ray White’s Chief Economist Nerida Conisbee published a sharp piece that captured the tone and trajectory of housing policy right now. She outlined how proposed interventions, from tweaking negative gearing to demand-side incentives, are being thrown around like confetti. Everyone’s talking. Few are listening. And even fewer are offering real solutions.

We agree with Nerida: the ideas may sound good on paper, but many are worse than baseless. They actively interfere with the market and distract from what really needs to happen.

Demand-Side Incentives: Politically Popular, Economically Risky

Let’s start with one of the most common political plays: stimulating demand.

Whether it’s first-home buyer grants, reduced stamp duty, or relaxing lending rules, these initiatives do one thing well – win votes. But in practice, they fuel demand without addressing the fundamental issue: not enough homes are being built.

When you boost buying power without increasing supply, prices rise. It’s simple economics. These short-term sugar hits distort the market and create false hope for buyers, all while ignoring the structural supply-side failures that got us here.

Both parties are taking us for fools – trying to ‘buy’ votes from the very people such policies will hurt. That said, great news for those that own homes, terrible news for those not in the market yet.

Negative Gearing: A Scapegoat That Still Serves a Purpose

Negative gearing has become the political football of the housing debate. But here’s the thing: it was introduced to incentivise private investment in housing because the government simply can’t build enough.

Is it a perfect system? No. But removing it without fixing supply first would do more harm than good. Right now, what the market needs is more private investors, not fewer. Without them, rental supply falls, vacancy rates tighten, and affordability suffers.

Solve the problem before you take away the solutions that are actually working.

Painting Landlords as the Villains? That’s a Political Strategy, Not a Solution

A recurring, and dangerous, narrative in politics right now is that landlords and developers are the enemy.

It’s easy to understand why this line plays well to voters, especially those struggling with rent rises or home ownership dreams. But it’s also completely counterproductive.

The reality? It’s private investors and developers who provide the overwhelming majority of rental housing and new supply. Vilifying them may earn political points, but it deepens the crisis by pushing people away from being part of the solution.

Take the recent Greens controversy as an example. A high-profile Greens candidate publicly positioned herself as a relatable renter advocate… only for it to be revealed that she owns two investment properties, including one in London. Not exactly the ‘battler’ narrative her party promotes.

This is the insidious nature of politicking: saying one thing to win a seat and doing another entirely when the cameras are off. She clearly understands the benefits of property investment, but to win a seat, she’s happy to cause harm to people she wants to vote for her by promoting an ideology that isn’t true and throwing landlords under the bus.

And that’s the problem. It’s not just hypocrisy, it’s harm. Every time housing policy is used to stir up resentment rather than drive reform, we drift further from actual solutions.

Fix the System, Then Phase the Supports

Real reform means understanding the domino effect of change. You can’t just wind back interest rate assessment buffers or strip away investment incentives overnight and expect balance. The system is too interconnected.

We need a sophisticated, all-of-government, staged approach that addresses root causes (land release bottlenecks, zoning inefficiencies, construction capacity, and infrastructure delays). Only once the system is stable and functional should policymakers consider tapering off supports.

And this is why we can have every confidence in price and rental prices rising indefinitely. We have the greatest imbalance between supply and demand we have ever seen and no possible way of resolving it due to a lack of courage and willingness to understand.

Investor Takeaway: Look Past the Politics

For property investors, the current political theatre isn’t a roadmap, it’s noise.

The fundamentals still point to long-term opportunity: strong population growth, undersupply of dwellings, and a rental market in dire need of support. While politicians posture, savvy investors are acting strategically.

At Investor Property, we’ll keep helping you cut through the noise, assess what really matters, and make confident decisions grounded in data – not theatrical displays or self-serving exploitation, but in tangible results that deliver long-term value.