It’s Federal Budget time, so let’s cut to the chase. What’s in it for aspiring homeowners looking to purchase a property in 2025?
Here are some of the key takeaways that could affect you.
Purchasing Property
Help to Buy scheme
Labor plans to boost its Help to Buy scheme by increasing income and property price caps.
Under the scheme, the Federal Government will provide an equity contribution of up to 40% to support eligible homebuyers (around 40,000 Australians) to purchase a home with a lower deposit and a smaller mortgage.
Around $800 million will be allocated to lift the property price caps and income caps from $90,000 to $100,000 for individuals, and from $120,000 to $160,000 for joint applicants and single parents.
Infrastructure investment
The 2025–26 Federal Budget has allocated $17.1 billion to various road and rail infrastructure projects across the country. It’s a good idea to be across these if you’re planning to buy, as they may affect housing development and surrounding property markets.
Examples include:
- $7.2 billion for safety upgrades on the Bruce Highway in Queensland
- Over $2.3 billion for critical infrastructure upgrades in the growing Western Sydney region
- A further $465 million for New South Wales to plan for regional projects and fix notorious choke points, including $250 million to upgrade Mona Vale Road and $115 million to reduce travel times on Terrigal Drive
- $2 billion to upgrade Sunshine Station in Victoria
- $350 million for the Westport – Kwinana Freeway Upgrades in Western Australia
Foreign investors banned
The Government announced a temporary ban on foreign purchases of established dwellings for at least two years and said it would crack down on land banking.
From 1 April 2025 to 31 March 2027, foreign persons, including temporary residents and foreign-owned companies, cannot buy an established dwelling in Australia unless an exception applies.
The measure is intended to open up more opportunities for local property purchasers.
Prefabricated homes a priority
Labor will allocate $54 million towards the prefabricated and modular housing industry to boost home building.
Prefabricated homes are manufactured offsite in a factory, then transported to their final location for assembly. They’re said to take half the time to build as traditional brick and mortar homes.
The Government has also committed $120 million from the National Productivity Fund to incentivise states and territories to remove red tape preventing the uptake of modern methods of construction.
Incentives for housing construction tradespeople
Labor will introduce a new Housing Construction Apprenticeship stream, offering eligible apprentices in housing construction trades up to $10,000 in financial incentives. This measure is designed to address workforce shortages and boost housing supply.
Cost of Living
New tax cuts and Medicare breaks
From 1 July 2026, the 16% tax rate, which applies to taxable income between $18,201 and $45,000, will be reduced to 15%. From 1 July 2027, it will be reduced to 14%.
A worker on average earnings will get an extra $268 in their pocket in the first year, and $536 from the 2027–28 financial year.
The Government will also increase the Medicare levy low-income thresholds. As a result, more than one million Australians on lower incomes will be exempt from paying the Medicare levy or continue to pay a reduced levy rate.
More energy bill relief
The Government will extend energy bill relief to the end of 2025. Every household and around one million small businesses will receive two $75 rebates directly off their electricity bills through to 31 December 2025.
Health
The Government plans to reduce the maximum cost of medicines on the Pharmaceutical Benefits Scheme (PBS) for everyone with a Medicare card and no concession card. From 1 January 2026, the maximum co‑payment will be lowered from $31.60 to $25 per script.
Cutting student debt
The Government will reduce all outstanding Higher Education Loan Program (HELP) and other student debts by 20%, subject to the passage of legislation.
The Government will also increase the amount that people can earn before they have to start paying back their loans ($54,435 in 2024–25 to $67,000 in 2025–26).
Growing wages
The Government intends to ban noncompete clauses for low and middle income employees. This is expected to boost wages, with workers free to move to higher paying jobs. Aged care and childcare workers are set to receive wage increases.
Looking to buy a property?
There’s a lot to digest from the Federal Budget, but we’re here to answer your questions.
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