Victoria’s 2026 election: how each party’s policies could shape your property investments

By Jarrod McCabe

Victoria goes to the polls on 28 November with land tax, stamp duty and housing supply are all on the table. But for the property market, this state election may matter less than you’d expect.

Over the past five or six years, state policy did a lot to shape how Victoria performed, particularly the land tax changes. This year has been different. The forces moving the market have been largely federal and global: the negative gearing and capital gains tax changes, rising interest rates, conflict in Ukraine and the Middle East, and cost of living pressure.

Some of that echoes the lead-up to the last state election four years ago, when rate rises, the war in Ukraine and a flat market were also weighing on buyers and sellers. The difference now is that the cooling isn’t just a Victorian story. It’s national.

That’s why we don’t expect the result to drastically shift the market over the next 12 to 18 months. But the policies on offer will shape the direction of Victorian property over the longer term. Here’s where Labor, the Liberals, the Greens and One Nation stand.

Land tax: three parties want to lift the threshold, the Greens want to target large investors

Of all the state levers, land tax has had the clearest impact on Melbourne’s investment market in recent years. The 2023 change, which took effect in 2024, cut the threshold from $300,000 to $50,000. Investors who owned apartments with land values of $150,000 to $200,000 suddenly faced land tax for the first time.

Many of those investors sold, mostly to owner-occupiers. That helped affordability for buyers. But it also reduced rental supply, and rents have continued to rise since.

Labor has committed to unwinding the change, lifting the threshold back to $300,000 over six years. It also plans to cut the land tax surcharge for global investors who build affordable housing.

The Liberals would also lift the threshold back to $300,000, over five years. Their policy came first. Labor’s six-year plan followed.

The Greens propose a different approach: an “ultra-wealthy” land tax of 5.3 per cent for investors holding more than $5 million in residential investment property. They estimate it would raise more than $6.4 billion over a decade, which would fund their stamp duty cuts.

One Nation would also lift the threshold back to $300,000, though it hasn’t specified a timeframe.

Stamp duty: different approaches to first home buyers and owner-occupiers

Stamp duty is one of the main reasons buying and selling property in Victoria has become so expensive. It’s also the lever parties most often reach for when trying to help first home buyers.

Labor isn’t planning any major changes. First home buyers currently pay no stamp duty on purchases up to $600,000, receive a sliding concession up to $750,000, and pay full duty above that. Labor has also offered stamp duty concessions on off-the-plan purchases to encourage development.

The Liberals would abolish stamp duty for eligible first home buyers on purchases up to $1 million, whether established or off-the-plan. They say this would save buyers up to $55,000 and benefit around 17,000 households in its first year.

The Greens would go further, abolishing stamp duty for all owner-occupiers, not just first home buyers, on purchases up to $1.1 million. A sliding scale would then apply up to $1.6 million, funded by their proposed land tax on large investors.

One Nation is focused on foreign buyers. It would raise the foreign purchaser duty on residential property, with the aim of stopping Victorian buyers being outbid by foreign purchasers.

Supply and planning: the policies that matter most for affordability

Our view is that this is the most important of the three areas. Supply is what improves affordability over time. Demand-side measures, whether grants or stamp duty relief, tend to work differently. Buyers often add the money to what they can pay, and prices rise to absorb it. Increasing supply meets demand rather than adding to it.

But supply only works if it’s the right supply in the right places. Building homes nobody wants, or in locations where nobody wants to live, doesn’t solve the problem.

Labor is maintaining its target of 800,000 new homes between 2024 and 2034, an average of around 80,000 a year. Density reforms and activity centres are central to that plan. On paper, activity centres make sense. They use existing infrastructure in inner and middle-ring areas where people want to live. In practice, they’ve met resistance. Many residents in these areas already deal with heavy congestion and worry that infrastructure won’t cope with more people without significant extra investment.

The Liberals have so far offered less detail. Their commitments include fast-tracking home building in designated growth areas, rejuvenating the CBD, expanding the capital city zone to enable more development, and supporting sustainable growth in regional areas. They would also restore local voice in planning through community-led structure plans, a clear response to activity centres.

The Greens are focused on public housing. They would stop the demolition of public housing, double the amount being built, and maintain and upgrade existing stock rather than replacing it. That includes opposing plans to redevelop the high-rise public housing towers in inner Melbourne.

One Nation has also provided limited detail so far. Its commitments include releasing underused government land, putting time limits on planning and building approvals, and making it easier to add granny flats and units in established areas without the government taking a cut, an approach it points to in South Australia. It would also require community consultation on high-rise development in established suburbs and offer incentives for private and community organisations to deliver low-cost housing.

Both the Liberals and One Nation may add more detail as the election approaches.

What the election means for Melbourne’s property market

The policies matter most over the longer term. A higher land tax threshold could ease pressure on investors who have been selling out of the market. Changes to stamp duty would affect how often people move, and how much buyers can pay. And planning decisions will shape what gets built, and where.

In the nearer term, interest rates, federal tax settings and confidence will remain the bigger drivers. The next federal election, due in around 18 months, is likely to be the more significant event for the market.

Take home message

Victoria’s state election offers clear differences on property policy, particularly on stamp duty and planning. On land tax, Labor, the Liberals and One Nation have all landed on lifting the threshold back to $300,000, while the Greens would target large investors instead.

For buyers and sellers, the result is unlikely to be the deciding factor in the year ahead. Watch the policies for their longer-term impact, and make your property decisions on the fundamentals.

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