Overview

It has been a week dominated by housing, with announcements from both major parties at their respective campaign launches on Sunday.

Prime Minister Albanese announced 5 per cent deposits for first home buyers, with the Federal Government to guarantee a portion of the loan, thereby removing the requirement to pay Lenders Mortgage Insurance; meanwhile, Opposition Leader Peter Dutton confirmed his pledge to allow Australians to withdraw a maximum of $50,000 from their superannuation to help pay for house deposits, and a new policy to let first-time homeowners of newly built properties make mortgage interest payments tax deductible (for the first $650,000 of their mortgage).

However, both policies were widely criticised for not effectively dealing with the structural issues causing the lack of supply in the housing market and instead only further boosting demand.

This week saw the unexpected entrance of Russian fighter jets into the election debate after a defence news website, Janes, report claimed Russia had asked to station aircraft in Indonesia. Mr Dutton said it would be a "catastrophic failure of diplomatic relations" if the Government had not been made aware, mistakenly stating the request had been “…publicly announced by the President of Indonesia.” Indonesian officials subsequently denied Russian aircraft would be based within their territory.

The ABC Leaders debate was another respectful affair, with both playing it safe despite some challenging moments. Mr Albanese struggled when asked when energy prices would drop after pledging this would happen at the last election. Mr Dutton admitted he made a mistake attributing the Russian plane reports to President Prabowo Subianto of Indonesia and declined to state climate change was making extreme weather events worse.

The Easter break means there are only eight working days left of the Federal Election campaign. Polling by Essential found 53 per cent of Australians have decided their vote and won’t change their mind, 34 per cent say they might change their mind, and 13 per cent are still undecided about their vote.

The major parties face a challenge in getting their message through to the remaining undecided group of Australians. There are reports in The AFR of a truce between Labor and the Coalition, with neither Leader campaigning or advertising on Good Friday or Easter Sunday. The Greens and Teals will continue campaigning however, perhaps reaching those undecided voters.

As we enter the home stretch, it remains to be seen whether there will be any surprise policy announcements or slip-ups from either Leader that will cause a shift in the polls.

Polling and Betting Markets

There haven’t been any major shifts in the polls beyond their margin of errors. Interestingly, polling from Freshwater has the Coalition’s primary vote on 39per cent, compared to an average of 33 per cent among other polls published over the last week. Across the polls this week, Labor is ahead on 2PP at 52 percent.

Additional questions from Resolve Strategic showed 33 per cent of all voters are less likely to vote for Mr Dutton because of their views about Donald Trump, whereas just 21 per cent of voters say they are less likely to vote for Mr Albanese. This is supported by polling from the Lowy Institute that finds 41 per cent of Australians think Mr Albanese would be more competent at handling Donald Trump, with 29 percent saying Mr Dutton and 29 per cent undecided.

The betting markets have shifted further in favour of Labor forming the next Government. Sportsbet prices Labor at $1.20 and the Coalition at $4.60. TAB has similar odds, with Labor at $1.22 and the Coalition at $4.25.

There are a number of key seats which will be crucial to determining the election outcome. In the tightest race in SA, Boothy is now the seat to watch instead of Sturt where Labor is priced as the clear favourite. In another seat to watch, Kooyong, Liberal candidate Amelia Hamer continues to lead against Teal MP Monique Ryan, despite recent reports discussing the former’s property portfolio and $20 million trust fund.

Policies Announced / Confirmed This Week

Australian Labor Party

• First-home buyers will be able to buy a property with a deposit of just 5 per cent, with the Government guaranteeing a portion of the home loan. This would remove the need for buyers to pay Lenders Mortgage Insurance, saving the average person around $23,000.
• $10 billion investment partnership with state developers’ industry to build up to 100,000 homes, which are reserved for sale only to first home buyers.
• Introduction of a $1,000 instant tax reduction from 2026-27, instead of claiming individual work-related expenses.
• $60 million to invest in Perth’s Swan River ferry network, building two new terminals and funding to plan and design a future extension of the network.
• Up to $60 million through the Aged Care Capital Assistance Program to support the construction of a new residential care home in Darwin with 120 beds.
• $16.7 million investment for eight Perinatal Mental Health Centres around the country to support Australian parents.

The Coalition

• First-time homeowners of newly built properties will be able to make mortgage interest payments tax deductible (for up to $650,000 of their mortgage), which would save an average of $12,000 per year.
• A Cost of Living Tax Offset of up to $1,200 for eligible Australians earning up to $144,000, with a total cost of $10 billion estimated.
• Pledged to clear the backlog of existing residential development environmental approval applications within 12 months, whilst projects already stuck in the approvals process for over a year will be finalised in six months.
• $100 million to upgrade regional medical training facilities and deliver 200 additional regional medical Commonwealth Supported Places to increase health professionals in regional, rural and remote Australia.
• $19.5 million for Foodbank Queensland to establish a new distribution centre in south east Queensland.

Australian Greens

• Every public school to be funded to provide a nutritious lunch to every student at a cost of $11.6 billion, and $85 million per year to expand existing free breakfast programs in schools across the country.
• Pledged a priority for the party in a minority government to make university and TAFE free; estimated to cost $46.5 billion over the forward estimates.

Commentary

“More money chasing the same amount of housing is the most well-worn path to failure in Australian policy making, and both the Government and the Opposition seem intent on proving that they can double down on that dumbness yet again. The upshot is that the campaigns of both major parties are a dumpster fire of dumb stuff. In the meantime, the world is on fire, and Australians need smart policies way more than we need smart politics. Fat hope of getting that, though.” – Chris Richardson, Economist

“Confusion on philosophy permeates the Coalition campaign. The nuclear plan is a big-government interventionist policy. Reducing fuel excise for a year is purely populist. Two “nation-building funds” are to be seeded with “windfall revenue” to spend on infrastructure. But what if there is no windfall revenue? What happened to windfall revenue paying down debt? Where is the serious policy work? Forget about fiscal consolidation or debt reduction. Tax reform is off the agenda. So is significant workplace relations change. No bold agenda for education.” – Troy Bramston, Senior Writer at The Australian

"Labor's housing policy may resonate with renters, predominantly in middle urban electorates like Parramatta and Chisholm. The Coalition's housing policy may resonate stronger in outer suburban communities, especially within the Indian Australian diaspora, who prefer purchasing new homes in growth areas, close to family." – Kos Samaras, Director Strategy and Analytics at RedBridge Group

“Halfway through the election campaign, the second debate revealed an Opposition leader still trying to trade off voters not feeling better off than they did three years ago and a Prime Minister not able to answer all the questions about how he would improve underlying problems in the economy but clearly besting his opponent on dealing with an increasingly uncertain international environment.” – Laura Tingle, Political Editor for ABC 7:30

"There will be a lot of people benefiting from all of these, the Labor side and Coalition side, who strictly speaking — it's not the difference between becoming a home owner and never becoming one at all … They're not very well targeted. Economists would say there is a lot of 'dead weight' in the spend.” – Hal Pawson, Professor Housing Research and Policy and Associate Director at UNSW’s City Futures Research Centre