--- title: How Mum-and-Dad Investors Can Help Solve Australia’s Housing Crisis description: Learn how Mum & Dad investors can help solve Australia’s housing crisis with tax benefits and strategic reinvestment. Insights from Koste. image: https://koste.com.au/wp-content/uploads/2024/10/Teachers.jpg --- [Skip to content](https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis#main-content) ![Gill Sans Nova](https://blog.koste.com.au/hs-fs/hubfs/KosteHorizTag-GreenGrey-2.jpg?width=395&height=100&name=KosteHorizTag-GreenGrey-2.jpg) Open main navigation Close main navigation - [Contact us](https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis#contact) [Contact us](https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis#contact) Nov 8, 2024 10:29:07 AM # How Mum-and-Dad Investors Can Help Solve Australia’s Housing Crisis ![Picture of Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://app.hubspot.com/settings/avatar/7bc5de67d203786a583b28d1f5e4a6fb) [Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://blog.koste.com.au/blog/author/mark) Share: [facebook-f icon](http://www.facebook.com/share.php?u=https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis) [linkedin-in icon](http://www.linkedin.com/shareArticle?mini=true&url=https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis) [Twitter icon](https://twitter.com/intent/tweet?url=https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis) [pinterest-p icon](http://pinterest.com/pin/create/link/?url=https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis) [envelope icon](mailto:?body=https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis) ![](https://koste.com.au/wp-content/uploads/2024/10/Teachers.jpg) # Australia is facing a **housing shortage of 1.5 million homes**, and the rising costs of construction and labour, alongside regulatory delays, are stalling new developments. However, **mum-and-dad investors**—who own **72%** of Australia’s investment properties—could be the key to solving this crisis, if the government enacts **bold tax reforms**. --- ### The Challenges of the Housing Crisis - **Construction Costs**: Over the past three years, construction costs have surged by **30%**, with **labour shortages** driving a **50% increase** in build costs in some regions, making new projects financially unfeasible. - **Rising Rents**: Rent prices have increased by **10%** in major cities, while vacancy rates sit at historic lows of **below 1%**, pushing rental costs higher. - **Planning Delays**: Red tape and slow planning approvals have further hampered new housing supply, adding to the cost and time of building. Additionally, **banks** are playing a critical role in this housing issue. With increasingly tight lending standards, it has become difficult for both investors and developers to secure the funding needed to build new homes. --- ### The Role of Mum-and-Dad Investors Australia has **2.2 million property investors**, with **1.6 million (72%) **of them owning just one property—typically **mum-and-dad investors**. Despite being such a large part of the housing market, less than **40%** are claiming **tax depreciation**, missing out on benefits that could increase their returns. Rather than pushing policies like **removing negative gearing**, which would only drive rents and prices higher, the government should focus on **tax incentives** that empower these small investors to invest in new housing supply. --- ### Tax Reforms to Unlock Housing Supply One of the most effective ways to incentivise mum-and-dad investors is through **instant asset write-offs** for new build investment properties. Under current laws, businesses can claim immediate deductions for plant and equipment. Extending this to small-scale investors would improve cash flow and encourage investment in new homes. Additionally, **Capital Gains Tax (CGT) reform** could encourage long-term property investments. Potential changes include: - **CGT exemptions or reductions** for new builds held for a certain period. - **CGT incentives for affordable housing**, encouraging investment in socially beneficial projects. - **CGT deferrals** if sale proceeds are reinvested into new housing, keeping investment capital within the market. --- ### The Role of Banks Banks must also be part of the solution by ensuring lending standards are balanced. While responsible lending is necessary, overly stringent conditions are limiting the ability of investors to access funding for new developments. Incentives for developers and mum-and-dad investors who commit to long-term housing projects could encourage more responsible and impactful investment. --- ### Learning from International Examples When looking at homeownership rates globally, Australia’s **66.5% homeownership** stands in contrast to countries like **Switzerland**, where **62.6%** of the population rents their homes, or **Germany** at **50.4%**. In these countries, renting is far more common, and the housing market reflects policies that support rental properties as a key component of supply. In Australia, strengthening both ownership and rental housing supply is key to tackling the crisis. Supporting **mum-and-dad investors** to build rental properties, with the right incentives, could be one part of the solution. --- ### My Advocacy for Change As the CEO of [Koste Chartered Quantity Surveyors](https://www.linkedin.com/company/koste/) a **committee member of the **[The Australian Institute of Quantity Surveyors](https://www.linkedin.com/company/australian-institute-of-quantity-surveyors/), a **member of **[RICS](https://www.linkedin.com/company/rics/), and a **campaigner for housing supply** through the [Gold Coast Central Chamber of Commerce](https://www.linkedin.com/company/gold-coast-central-chamber-of-commerce/) , I have actively pushed for **tax reforms** that will make a real difference. Hosting events with **key developers**, **local and federal representatives**, and the **Housing Minister**, I’ve focused on advocating for **bold, pro-growth tax policies**. --- ### Conclusion: The Path Forward Australia prides itself on offering the opportunity for homeownership, but with **33.5%** of Australians renting, we must also ensure there is enough rental supply to meet demand. With **mum-and-dad investors** empowered through **tax reforms** like **instant asset write-offs** and **CGT incentives**, we can begin to solve the housing crisis—one new home at a time. The time to act is now, before the problem worsens. [Housing](https://blog.koste.com.au/blog/tag/housing) ## Related posts [![](https://blog.koste.com.au/hs-fs/hubfs/A%20happy%20construction%20worker%20drawing%20a%20city%20with%20white%2c%20plain%20buildings%2c%20using%20arrows%20and%20angles.jpeg?height=200&name=A%20happy%20construction%20worker%20drawing%20a%20city%20with%20white%2c%20plain%20buildings%2c%20using%20arrows%20and%20angles.jpeg)](https://blog.koste.com.au/blog/understanding-the-current-landscape-of-construction-costs-in-australia) [Housing](https://blog.koste.com.au/blog/tag/housing), [Construction Costs](https://blog.koste.com.au/blog/tag/construction-costs) ## [Understanding the Current Landscape of Construction Costs in Australia](https://blog.koste.com.au/blog/understanding-the-current-landscape-of-construction-costs-in-australia) ![Picture of Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://app.hubspot.com/settings/avatar/7bc5de67d203786a583b28d1f5e4a6fb) [Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://blog.koste.com.au/blog/author/mark) Nov 8, 2024 11:24:13 AM Since the pandemic began, construction costs in Australia have surged, affecting both residential... [Read more](https://blog.koste.com.au/blog/understanding-the-current-landscape-of-construction-costs-in-australia) [![](https://blog.koste.com.au/hs-fs/hubfs/Tower%20Bridge%20in%20London%2c%20UK.jpeg?height=200&name=Tower%20Bridge%20in%20London%2c%20UK.jpeg)](https://blog.koste.com.au/blog/maximising-tax-depreciation-on-overseas-property-investments-for-australian-investors) [Commercial Tax Depreciation](https://blog.koste.com.au/blog/tag/commercial-tax-depreciation), [Residential Tax Depreciation](https://blog.koste.com.au/blog/tag/residential-tax-depreciation) ## [Maximising Tax Depreciation on Overseas Property Investments for Australian Investors](https://blog.koste.com.au/blog/maximising-tax-depreciation-on-overseas-property-investments-for-australian-investors) ![Picture of Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://app.hubspot.com/settings/avatar/7bc5de67d203786a583b28d1f5e4a6fb) [Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://blog.koste.com.au/blog/author/mark) Nov 8, 2024 11:10:11 AM Australian investors are increasingly looking abroad to diversify their property portfolios, often... [Read more](https://blog.koste.com.au/blog/maximising-tax-depreciation-on-overseas-property-investments-for-australian-investors) [![](https://koste.com.au/wp-content/uploads/2024/07/APPLICATION-FORMS-1.png)](https://blog.koste.com.au/blog/the-impact-of-rising-construction-costs-on-tax-depreciation) ## [The Impact of Rising Construction Costs on Tax Depreciation](https://blog.koste.com.au/blog/the-impact-of-rising-construction-costs-on-tax-depreciation) ![Picture of Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://app.hubspot.com/settings/avatar/7bc5de67d203786a583b28d1f5e4a6fb) [Mark Kilroy Bsc (Hons) MAIQS CQS MRICS](https://blog.koste.com.au/blog/author/mark) Nov 8, 2024 10:31:39 AM [Read more](https://blog.koste.com.au/blog/the-impact-of-rising-construction-costs-on-tax-depreciation) facebook-f icon linkedin-in icon Twitter icon instagram icon - [New job Request](https://share.hsforms.com/1SLxMB503TburAJ-3k3FsiQs8l47) - [Knowledge Hub](https://koste.com.au/knowledge-hub/) - [Residential Tax Depreciation](https://koste.com.au/residential/) - [Commercial Tax Depreciation](https://koste.com.au/commercial/) --- [![Gill Sans Nova](https://blog.koste.com.au/hs-fs/hubfs/KosteHorizTag-GreenGrey-2.jpg?width=395&height=100&name=KosteHorizTag-GreenGrey-2.jpg "Gill Sans Nova")](http://www.koste.com.au) Brisbane Tech Park 2/88 Brandl Street, Brisbane QLD 4113 Copyright © 2024, Koste Pty. Ltd. ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Mark Kilroy Bsc (Hons) MAIQS CQS MRICS", "url" : "https://blog.koste.com.au/blog/author/mark" }, "dateModified" : "2024-11-08T00:29:07.384Z", "datePublished" : "2024-11-08T00:29:07.000Z", "headline" : "How Mum-and-Dad Investors Can Help Solve Australia’s Housing Crisis", "image" : [ "https://koste.com.au/wp-content/uploads/2024/10/Teachers.jpg" ], "mainEntityOfPage" : { "@id" : "https://blog.koste.com.au/blog/how-mum-and-dad-investors-can-help-solve-australias-housing-crisis", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://blog.koste.com.au/hubfs/KosteHorizTag-GreenGrey-2.jpg" }, "name" : "Koste Pty. Ltd." } } ```