Property prices could be set to fall even further

Home ownership in Australia has been heading one way for 30 years – down.

But Labor plans to disrupt that trend, by limiting negative gearing and halving the discount on property capital gains tax.

Also read: 3 warning signs you’re dealing with a property spruiker

But a new report warns that Labor’s approach could further damage some markets which are already stumbling.

New South Wales could see prices for units and houses drop by 9%, in Victoria there could also be a 9% drop for house prices and a 6% drop for units, in Queensland 6% for houses and 7% for units, in South Australia that price drop could be 6% for both houses and units, while in Tasmania prices could drop 2% for houses and 3% for units and over in Western Australia, residents could enjoy a huge price drop of up to 10% for units.

Also read: Australia’s 20 fastest-growing housing markets revealed

While some potential prices falls sound steep, markets have spiked sharply in the last 5 years.

Experts say any reform must encourage building of more owner-occupied housing.