Buyer’s agent Zoran Solano: Market spooked
First-home buyers are failing to fill the void left by retreating property investors, despite government claims young Aussies were the real winners from the 2026 Budget shake-up.
An end-of-financial-year market scorecard from the Real Estate Buyers Agents Association of Australia (REBAA) reveals a nationwide drop in buyer confidence, driven by the Federal Budget’s looming threats to negative gearing and capital gains tax.
Prime Minister Anthony Albanese and Treasurer Jim Chalmers have championed the controversial tax reforms as a way to “level the playing field,” by putting first-home buyers ahead of investors.
Mr Solano said the threat of tax reforms had triggered a huge shift
But buyer’s agents warn young buyers had been gripped by the same hesitation sweeping the wider market.
REBAA vice president Zoran Solano said the threat of tax reforms had triggered a huge shift in both buyer and seller behaviour across the nation.
“The policy debate alone had been enough to cool confidence across multiple markets, with many investors pausing acquisitions, reassessing borrowing capacity and re-running the numbers on cash flow, holding costs, and long-term strategy,” Mr Solano said.
Australian Bureau of Statistics (ABS) lending data for the March quarter showed national investor loan commitments fell 5.3 per cent as policy debate heated up, with new owner-occupier first-home buyer loans down 4.3 per cent over the same period.
Mr Scafidi said first-home buyers had not replaced investors
REBAA Victoria state representative Matt Scafidi said the tax reform debate had spooked first-home buyers as well as landlords.
“The immediate impact has not been an influx of first-home buyers replacing investors, but rather a reduction in overall investor confidence,” Mr Scafidi said.
Likewise in Perth’s formerly red-hot market, entry-level buyers were failing to step up despite a surge in new listings by long-term investors.
REBAA Western Australia state representative Peter Gavalas said while investors were sidelined, “first home buyer activity has, however, slowed down as confidence is low and new stock is coming to the market quicker than it can sell.”
Sydney auction rates have slumped to eight-year lows. Pic: Monique Harmer
With realestate.com.au data showing auction clearance rates slumped to eight-year lows of about 40 per cent this month, REBAA New South Wales state representative Linda Johnson said Sydney was displaying clear signs of market exhaustion.
“The Federal Budget has had largely a negative effect on market confidence, evidenced by falling auction clearance rates, discounted prices, less buyer activity and in some areas either a backlog of stock, or continuing limited stock availability in others,” Ms Johnson said.
Even Queensland’s multi-year property boom had slowed as buyers opted out of bidding wars amid broader economic uncertainty, the state’s REBAA representative Melinda Granzien said.
Govt claimed the changes would create a more level playing field for young buyers
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“Across Southeast Queensland and many regional markets, conditions are shifting from a strong seller’s market towards a more balanced environment,” Ms Granzien said.
REBAA South Australia state representative Matt O’Donoghue also warned the days of rapid price growth were numbered.
“With the impending budget changes, my thoughts are that investors looking at established dwellings may sit on their hands moving forward until the dust settles,” Mr O’Donoghue said.
Meanwhile, demand remained strong in Tasmania, as regional buyers chased affordability, according to state representative Samantha Spilsbury.
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