Less Hype - More Facts
I don't think Queensland house prices are going to crash because of CGT and negative gearing changes.
I think the most likely outcome is that 'price growth slows', certain markets temporarily soften, investor activity reshuffles, and then prices continue rising over the medium-to-long term because the underlying supply problem still hasn't been solved.
When you strip away the politics, house prices are driven by a handful of fundamentals:
Population growth
Housing supply
Construction costs
Credit availability
Employment
Interest rates
Tax settings matter, but they're usually a secondary influence compared to those factors.
What actually happened last time?
Everyone references the Hawke/Keating changes in 1985.
The common story is that removing negative gearing caused rents to explode and the government quickly reversed course. The reality is more nuanced.
The data shows Sydney and Perth experienced significant rental pressure, while Brisbane and Adelaide actually saw rents fall in real terms during that period.
Property prices certainly didn't collapse.
What history does show is that investor demand weakened, but housing markets continued to be driven largely by supply, population growth, interest rates and broader economic conditions.
Why Queensland is different
Queensland isn't Sydney.
Queensland currently has several powerful tailwinds that didn't exist in many previous cycles:
Strong interstate migration
Major infrastructure spending
Olympic-related investment leading into 2032
Chronic housing shortages
Tight rental vacancy rates
A construction sector struggling to keep pace with demand
Even economists who expect the national market to soften are still seeing relative resilience across Brisbane and many regional Queensland markets because supply remains constrained.
That's the part many commentators miss (or don't report).
If Australia was oversupplied with housing, tax changes could have a dramatic impact on prices.
But we're not Oversupplied - We're Undersupplied.
What I think will happen to Queensland prices
My base case would be:
Short term (12-24 months)
Increased uncertainty
Some investors pause decisions
Higher stock levels in certain suburbs
Slower growth rates
Potential small corrections in investor-heavy markets
Medium term (2-5 years)
Investors shift towards new builds because the tax incentives remain stronger there
Established housing remains undersupplied
Owner occupiers absorb some stock sold by investors
Population growth continues supporting demand
Long term (5+ years)
Housing supply remains the dominant issue
Prices continue trending higher unless Australia materially increases housing construction
The biggest thing people are overlooking (and the media are not reporting)
The proposed changes are largely grandfathered and don't fully apply to existing holdings. They mainly affect future investment decisions.
That means you're not suddenly forcing millions of investors to sell tomorrow.
Instead, you're gradually changing the attractiveness of future purchases.
Historically, gradual policy changes tend to slow growth rather than create outright crashes.
My view on Queensland specifically
If I was looking at Queensland over the next decade, I'd be far more focused on...
Housing shortages
Migration into Southeast Queensland
Infrastructure delivery
Interest rates
Building approvals and construction capacity
... than I would be on negative gearing or CGT.
Tax changes can influence demand around the edges.
A shortage of tens of thousands of dwellings influences the entire market.
That's why I suspect the headlines will continue to predict disaster, but the more likely reality is a period of slower growth, some volatility, and then continued upward pressure on prices as supply struggles to catch up with demand. The good old forever reliable ‘J-Curve’.
In Australian property, the pattern has been remarkably consistent for decades:
Whenever the market experiences a policy shock, credit squeeze, rate spike or economic scare, growth pauses for a period - but unless the underlying supply-demand imbalance is fixed, prices eventually resume their upward trend.
And Queensland's current supply-demand imbalance remains significant.
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