this post was submitted on 02 Nov 2025
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Let’s say that housing prices come down back in line with historic (pre-2000s) trends, as honestly - they damn well should; how do we not fuck over the millions of otherwise innocent owner-occupiers who suddenly find themselves severely underwater on their mortgages, due to no fault of their own?
This is the needle we need to thread as a nation, and it’s a bloody hard one.
We take those Stage 3 tax cuts that the wealthy gobbled up (leave the ones for the lower earners) and use them to pay off the banks.
Then write legislation to prevent this shit happening again.
It’s a good idea to start with, but flooding banks with that much money will likely have a massive down-side (think post-COVID19 levels of inflation), and it would be difficult to determine the right amount for each house, given that prices would still be in flux/freefall.
My initial thoughts were about providing income tax deductions for losses on primary residence (eg. If your $900K townhouse in the ‘burbs devalues to $400K, you can claim the $500K over however many years it’s take you), as long as you continue to service your mortgage, after the initial refinance to determine eligibility.
But I’m sure a tonne of people would be able to immediately spot loopholes or other reasons why my idea wouldn’t work either.
It’s not actually all that easy, unfortunately - otherwise you’d think we’d already have had a politician put forward a proposal by now.
It's essentially impossible. We've been hearing "the housing bubble is going to burst" for what, 30 years now? It's not going to burst because the government won't let it, because if it did the entire country would be completely and utterly fucked because everything is tied up in property. There is no lowering of house prices by any significant amount in our future.
What we need is to cut red tape and ridiculous fees on new developments/builds to encourage building (especially on secondary dwellings/granny flats - there should be ZERO council fees to build a granny flat on your own property) to increase supply, drastically reduce migration temporarily to reduce demand, ban foreign investors - even temporarily, and get rid of the fucking ridiculous 5% deposit mortgages they just introduced.
That's a few very easy things to do that would go a long way to getting things back under control. Prices won't go down, but most of them will stop going up. Inner city/beachside/"exclusive" places etc are always going to go up in price because that's where people want to be the most, and there is no more supply coming for those really.
Another thing that the government need to be doing is building some new big cities, and investing in existing ones to try and make people ok with moving 3 hours from Brisbane for example, because the city there is no longer just a single petrol station, a coles, and a bottle-o.
At the end of the day, if demand keeps outpacing supply at the ever increasing rate that it is now, there's literally no fixing it.
And reduce the appeal of property as an investment.