Victoria recorded the lowest sentiment nationally for its state government's handling of planning and managing growth, recording negative 71 points.
Sentiment declined nationally, with the survey completed by Property Council members as the impacts of the global fuel crisis were also beginning to be felt across the economy.
Recent Property Council research shows that more than 65 per cent of Property Council member organisations are being impacted by rising fuel costs, with more than 70 per cent experiencing increased construction costs. Around half are experiencing higher transport costs. More than half of respondents say projects have been delayed, while just under half have experienced a decline in customer demand.
Property Council of Australia Victorian Executive Director Cath Evans said the results show a sector battling under the combined weight of tax pressure, rising costs and global volatility.
"The numbers don't lie – confidence is falling, and it's becoming harder for the industry to deliver the homes Victorians need.
"Right now, the cost of developing in Victoria simply isn't stacking up for a vast array of projects. Rising construction costs and the highest property taxes in the country are stalling projects and deterring investors.
"The global fuel crisis is only adding to the pressure cooker - with the sector reporting additional cost increases, delayed projects and decreased consumer demand.
"Investment is already leaving Victoria, with overseas institutional capital down more than 50 per cent in just three years as outlined in our Attracting International Capital report.
"This is a critical moment. Without action to restore confidence, housing supply will fall further behind demand – as we saw in the latest round of ABS dwelling completion figures.
"We need to be delivering more housing – particularly affordable homes – while also fast-tracking major projects that support growth.
"Next month's Victorian Budget is an opportunity to reset – through targeted tax reform, faster planning, and a clear focus on getting more homes built.
Ms Evans said that the property sector continues to call for the appointment of a Housing Commissioner to oversee the sector.
"It's clear that the industry is at a crossroads. A Housing Commissioner would provide an independent review of housing delivery, hold the government to account on delays, and work closely with Treasury and key government agencies to ensure tax, planning and infrastructure policies are aligned to support housing delivery.
"This appointment, along with targeted tax reform, would provide a boost of confidence at a time when faith in the government is hitting a major low.
"The message from industry is clear – until confidence is restored, Victorians will pay the price."
The Q1 2026 survey was conducted online between 9 March and 27 March 2026 and included 435 respondents
