Research involving more than 500 legal, financial, banking and property professionals finds 78% expect property values to decline, and fewer than one in ten believe the reforms will improve housing supply.
Image Credit: Herron Todd White
Research conducted by Australia's leading independent property valuation and advisory firm, Herron Todd White has found widespread concern among industry professionals regarding the Federal Government's tax reforms and the downstream impact on the Australian property market.
Based on live polling of more than 500 property professionals on 25 June 2026, the findings show that a strong majority of respondents expect the legislated reforms to reduce residential property investment, further dampening market confidence and leading to a marked reduction in Australian housing values.
Herron Todd White Chief Executive Officer Peter Maloney said the findings were a clear indication of industry sentiment among professionals working across Australia's property and financial systems.
"These findings reflect the views of professionals who advise, finance, value, and regulate property transactions every day," Mr Maloney said.
“The overwhelming view among respondents is that the tax reforms will reduce investor participation and do nothing to lift housing supply, which remains one of Australia's most pressing economic challenges."
Three in Four Expect Investors to Exit
When asked whether they expected a significant number of residential property investors to sell or stop investing as a result of the reforms, 75 percent of respondents answered yes.
Mr. Maloney said the findings reflected widespread concern that investor confidence has immediately weakened as the Federal Government moves to implement the property tax reforms recently passed by Parliament.
"When investors are prevented from purchasing established properties, with the benefit of negative gearing, there is genuine concern the impacts could extend to downstream rental supply, housing confidence and broader market activity."
“There is nothing to suggest that investors will suddenly pile in and take advantage of negatively gearing new dwellings to help fuel supply, and if they did, we now have the perverse equation of first home buyers having to directly compete with investors for new dwellings. The irony of this is that the tax reforms may well have created more competition for new dwellings, the category in which first home buyers are more likely to start their home ownership journey.
"Reduced investment activity also has the potential to flow through to rental supply, housing confidence and broader market stability."
Nearly Eight in Ten Expect Property Values to Decline
The research also found 78 percent of respondents expect residential property values to decline if the reforms proceed.
When asked how they expected the tax reforms to affect residential property values over the next two years:
- 37.7 percent expect values to decline by between 5 and 10 percent
- 28.4 percent expect values to decline by up to 5 percent
- 11.8 percent expect values to decline by more than 10 percent
- 14.7 percent expect no material change
- 7.4 percent expect values to increase
"While the extent of any market adjustment remains uncertain, there is a clear expectation among industry participants that the proposed reforms would place downward pressure on residential property values," Mr Maloney said.
Industry Doubts Reforms will Improve Housing Supply
The research found limited confidence that the tax reforms would improve Australia's housing supply challenges.
"Nearly three in four respondents (74.5 percent) believed the reforms would either worsen housing supply or have no material beneficial impact," Mr. Maloney said.
When asked whether the reforms would improve or worsen housing supply shortages:
- 43.5 percent said they would worsen housing supply shortages
- 31.0 percent said they would have no material impact
- 16.0 percent were unsure
- Just 9.4 percent believed they would improve housing supply
Mr. Maloney said the finding highlighted a major disconnect between the stated policy objective and industry expectations.
"Less than one in ten professionals surveyed believe these reforms will improve housing supply outcomes," he said.
"That is a significant finding given housing supply and affordability remain central to Australia's economic and social policy agenda."
"These findings provide an important insight into how the professionals who work across Australia's property and financial systems believe the reforms are likely to impact investment, housing supply and market confidence," Mr Maloney said.