The latest Procore/Property Council survey of 935 Property Council members measures levels of optimism in the property industry. It found that industry confidence stayed at an index level of 124 for the September Quarter survey, with a score of 100 considered neutral.
Nationally, housing supply and affordability remains the most critical issue (32 per cent).
The share focusing on national tax reform has jumped 10 per cent to 22 per cent in the past year, the highest level since tracking began in September 2019.
At a state level, 32 per cent of respondents named property taxes and charges as the top issue for state governments – 11 per cent above the historical average and a record high. This surpasses housing supply and affordability (29 per cent).
This result was driven by respondents in Victoria, where 63 per cent said it was the top issue for the Victorian Government.
Property Council Chief Executive Mike Zorbas said while tax reform has been on the agenda thanks to the Economic Reform Roundtable, the way we tax new homes across the country has to change.
"New home buyers are being slugged with a shocking tax burden. Thirty per cent of a new home's purchase price goes in government taxes, only a fraction of which end up as community infrastructure," Mr Zorbas said.
"Add the extra taxes on institutional investment in apartments, build-to-rent, student accommodation and retirement living, and it almost looks like state governments don't want new homes to be built.
"Our planning assessment systems remain imperfect, with 21 per cent of respondents identifying them as the top issue for state governments. While many governments are rightly focusing on assessment reforms to boost housing supply, taxes on property are high and rising in states like Victoria.
"That means less investment in homes, commercial, retail and industrial assets that make people's lives better."
Expectations around residential house price growth remain high, with an index score of 62.1, significantly exceeding the long-term average of 15.9. It is at the highest levels since the June quarter of 2021. A score of 0 is considered neutral.
The index for housing construction expectations has continued to climb, reaching 39 on the index, marking the highest level since December 2021 and surpassing the long-term average of 22.9.
Mr Zorbas said there is cautious optimism for the residential sector, but that more needs to be done.
"The National Housing Accord has spurred a large effort from governments to boost housing supply, and that should be welcomed.
"However, the reality is that we are behind our targets and without more effort, we won't bridge that gap."
