Western Australia Private Rental Construction Rises $8 Billion

Western Australia could receive an $8 billion increase in private rental construction if investors redirect funds to new housing, according to a Perth property expert. Over the past year, total property investment exceeded $16 billion, the expert said. In the March 2026 quarter, 79 per cent of investor spending went to established properties.

Chalmers announced in the federal budget earlier in May that negative gearing and the capital gains discount would be limited to new builds. Chalmers said investors could still purchase negatively geared properties if they chose new houses. The Perth expert stated that investors already receive maximum depreciation allowances and other incentives for new homes.

The expert predicted the negative gearing changes could become a tipping point for investor-focused construction in inner and near-city suburbs.

The expert said the opportunity could be lost without government underwriting of projects and guarantees for 20 per cent mortgage deposits. The expert called for reductions in GST and stamp duty for infill developers, faster building approvals, and reviews of public art levies and design panel meetings.

Ray White Commercial chief executive James Linacre said investors may shift away from passive residential investment toward commercial property. Linacre noted that commercial assets often provide stronger rental yields and longer lease terms. Linacre added that Chalmers’ changes alone would not solve the national housing shortage because supply remains the core issue.