Fresh economic modelling has sharpened concerns over the federal budget's housing tax package, with a late addition targeting self-managed super funds (SMSFs) now estimated to strip almost 2,000 dwellings from the pipeline by 2029/30.
The supplementary analysis, prepared by Qaive and Tulipwood Economics and commissioned by the Real Estate Institute of Australia alongside Master Builders Australia, the Housing Industry Association, and the Property Council of Australia, examines the impact of banning limited recourse borrowing arrangements (LRBAs) for SMSFs purchasing ordinary residential investment property — a measure added during Labor–Greens negotiations to pass the wider budget package, and detailed alongside a joint media statement issued by the four bodies.
Industry bodies previously called on Canberra to pause the ban for newly built housing until Treasury independently assessed its impact on supply.
In isolation, the SMSF amendment is projected to reduce new dwelling starts by 427 in 2026/27, peaking at 516 in 2028/29 before easing to 494 by 2029/30 — a cumulative loss of around 1,950 homes. Construction employment is forecast to fall by 886 full-time-equivalent years over the period, while GDP is estimated to shrink by $182 million cumulatively, according to the modelling.
The affected market may be larger still: non-bank lender members of the Australian Finance Industry Association (AFIA) wrote more than 16,000 new residential SMSF loans in FY26, backed by $10.3 billion in security — likely an understatement, according to the group.
Even accounting for the modelling's own figures, the SMSF measure is only one part of a much larger package: combined with the budget's negative gearing and capital gains tax changes and the $2 billion Housing Support Program, the total housing package is now projected to cut new dwelling starts by 10,700 and reduce cumulative GDP by roughly $1.05 billion.
Rental prices are expected to bear much of the pressure. The SMSF measure alone is forecast to lift rents by 0.16 percentage points by 2029/30, contributing to a combined rental increase of 1.69 per cent across all three measures — equivalent to around $10 a week, according to the statement.
The bodies argue the figures widen the gap between government projections and independent estimates, stating: "Australia cannot resolve its housing shortage through policies that make it harder to finance, build, and supply rental homes."
They noted the government's own projections point to "up to 30,000 additional homes over the decade" when its housing measures are considered together with other supply initiatives — a figure the industry groups say will be tested against real-world data as the reforms take effect.
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