2019 Pre-Election Budget

2019 Pre-Election Budget Released

How will the proposed 2019 Budgets affect home owners and investors?

Last week, Scott Morrison and Bill Shorten released their proposed budgets prior to 2019 Pre-Election following the national election on May 18 2019.

Many topics including infrastructure, employment and health services were addressed, which covered the news headlines. Housing affordability plans and assistance schemes were given mention by both major parties.

The Coalition – Scott Morrison’ housing affordability policy & ASIC’s new enforcement strategy

In short: The Coalition will dedicate $1.7Bn toward ‘housing affordability’ for low income workers and people on government pensions. $606.7M over 5 years dedicated toward responses to the Banking Royal Commission’s 76 recommendations.


  • The Scott Morrison government promises a fund-raising mechanism dedicated toward building social and community housing for Australians on welfare pensions such as disability schemes.
  • ASIC’s new enforcement strategy and expansion of capabilities is granted the largest slice of the $606.7M for RC recommendations. This will enhance supervisory and enforcement activities respective of bank operations and remuneration. Treasurer Josh Frydenberg stated this would ‘strengthen the financial system and deliver better outcomes for all Australians’ [1].


  • Little is mentioned for independent First Home Buyers. While the recent housing price fall has hindered investment purchases and opened up competitive space for First Home Buyers, the Coalition’s proposed 2019-2020 budget has not mentioned any government support in this advantageous buyer’s market.

Some states continue to offer First Home Buyers grants, so check out our Stamp Duty Calculator if you could be exempt from paying stamp duty and receive a First Home Owner Grant in your state.

Who are the winners under the Coalition Budget?

Under the Coalition’s proposed 2019 budget, the winners in the housing space will be Australians seeking community and social housing.

Pre-Election Budgets. Bill Shorten replies to Scott Morrison

Budget talks fire up prior to the 2019 Federal election on May 18

Labor Party – Bill Shorten’ change to negative gearing policy and capital gains tax

In short: ALP’s policy will be to reduce the capital gains tax discount by 50%. Negatively geared property losses will only be able to be written off against other investment income, as opposed to writing off against standard taxable wages and salary income.


  • By Labor’s policy reducing the incentive to buy a negatively geared investment property, the bottom line will see less investment interest and more owner occupiers shifting into the housing mix. This includes First Home Buyers. Having said this, ALP gave no mention to financial assistance for First Home Buyers – similarly to the Liberals’ proposed budget [4].


  • Currently the capital gains taxes 47c per dollar on investment properties owned less than a year, and offers a 50% discount on that tax for properties owned over a year. Labor’s proposed tax discount policy will decrease existing tax discounts by half [3]For example, the capital gains tax of an investment property sold for $500,000 go from $132,500 on current policy to $198,750 under the proposed policy.
  • Investors are hit with another blow when writing off losses from negatively geared properties against tax paid on wages. The proposed ALP policy will only allow losses to be written off against other investment income, as opposed to writing off against standard taxed wages.

Who are the winners under Labor’s proposed budget?

Ultimately under Labor’s proposed budget, investors who don’t negatively gear their rental properties will be the winners, along with future owner occupiers currently fighting against investors to buy a live-in property.

How will the 2019 proposed party budgets affect you?

How will the 2019 proposed budgets affect you as a home owner? Check your enrolment details are correct at https://www.aec.gov.au/.


[1] Frydenberg, ABC News https://www.youtube.com/watch?v=emBzmJPUuok 

[2]  Kane, The Advisor, https://www.theadviser.com.au/breaking-news/38971-budget-2019-20-released# 

[3] Chang, News.com.au https://www.news.com.au/finance/real-estate/buying/housing-explainer-labor-and-coalition-policies-on-negative-gearing-and-capital-gains-tax/news-story/206dd8af09ae4a29cb475adb76c00fbc

[4] Redman, Blayden, Domain https://www.domain.com.au/news/federal-budget-2019-little-for-housing-affordability-amid-property-slowdown-815208/

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