At the state and territory level, wages growth was also relatively strong in Western Australia (3.6 per cent) and Queensland (3.4 per cent).
Overall, these figures were broadly as expected, with reasonable nominal wage price growth, but wages going backwards after inflation for a second consecutive quarter.
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Both the Federal Budget papers and the latest ABS arrivals and departures figures this week ahve highlighted that immigration has been - and is set to remain - higher than previous expected.
There's been a lot of commentary about the property market yesterday and today - I've done a few webinars myself! - but on this evidence it seems that the tight rental market is going to be a key issue to watch over the remainder of the year.
The Coalition has stated that it will fight the proposed Budget reforms all the way, which suggests that the new rules will become effective by 1 July 2027, but will be then contested in a Federal election, perhaps soon thereafter.
As a point of interest, New Zealand's foray into mortgage interest limitation rules which restricted deductibility commenced on 1 October 2021, but were reversed effective 31 March 2025 upon the change of government.
Investment strategies
It'll be interesting to see how property market commentary plays out over the year ahead.
Markets have a way of finding an equilibrium and the proposed changes will wash through in time, after a period of likely turbulence.
No doubt a lot of property advisors will be recommending new house and land packages for the ongoing tax benefits, though I've seen plenty of people lose money going down this route in the past.
It may also be that the newly proposed rules are reversed in 2028, depending upon election results.
But in the meantime what other strategies might property investors be looking at?
Here are 3 likely candidate options:
1 - Commercial property
More investors will look at industrial or warehouse type property, where the net yields might be in the range of 6 to 7 per cent, thereby not requiring or relying upon negative gearing benefits.
2 - Buying cheap units below replacement cost
It costs about $700,000 just to build a box these days in Australia - before you even think about the site costs - so there are certain parts of the country where investors will look at units at the cheaper end of the market.
To perm one example, you could buy a 2/1/1 unit in an attractive suburb such as Prahran, St Kilda, Windsor, Elwood, or a similar suburb in Melbourne for around $500,000, and the cashflow would be pretty reasonable, depending upon the property and deposit size.
3 - Overseas property
Real estate die-hards may also look overseas.
In New Zealand the housing market has corrected, for example, and there are some relative bargains to be found, as well as NZ being favourable from a stamp duty perspective.
In the United Kingdom, where you can borrow at fixed mortgage rates of around 4 per cent, it's not too hard to find cashflow positive properties, especially given the considerably more favourable exchange rate over the past year which allows investors to put down a reasonable deposit.
In time, I believe the tax changes will wash through via lower prices and higher rents, and some type of normality will eventually resume for property investment.
But in the immediate term lending to prospective investors in the established housing market will almost certainly dry up, and investors will need to work much harder to find deals that stack up for them.
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