The Property Investors Council of Australia (PICA) has released analysis claiming Victorian government housing policies have cost Melbourne homeowners an average of $100,000 in lost property value growth over the past three years.
According to PICA, Melbourne’s median dwelling price rose just $28,000 between January 2022 and December 2025 – significantly less than gains in other capitals.
The analysis suggests Sydney homeowners gained an additional $98,000 above Melbourne’s performance, Brisbane owners $345,000 more, Adelaide $405,000, and Perth $587,000.
PICA attributed the gap to a combination of state government interventions, including the COVID Debt Levy’s reduction of the land tax threshold from $300,000 to $50,000, expanded vacant land taxes, short-stay levies, and rental reforms affecting landlord flexibility.
PICA said the policies had created unintended consequences, with landlords selling properties in response to the changes, creating oversupply and suppressing values.
They acknowledged the policies had improved housing affordability but argued they failed to address underlying supply issues.
Without increased construction, they warned Melbourne could face sharp price increases and market volatility.
They also noted the lost equity would affect Victorians planning to retire, potentially limiting their options to move interstate.
Australian Bureau of Statistics data shows Victoria built 54,156 new homes in 2025 – the highest of any state but still more than 25,000 short of the government’s 80,000-home annual target.
The Real Estate Institute of Victoria has separately called for a review of state policies and taxes, citing an independent survey showing most Victorians believe taxes and regulation are affecting homebuyers and investors.