Victoria’s Property Tax Blowout – What It Means for Buyers, Sellers, and the Market in 2025–26
/Victoria’s Soaring Property Taxes – A Warning Sign for the Market?
In the 2025–26 State Budget, the Victorian Government announced that property-related tax revenue is expected to hit an extraordinary $19.8 billion—a dramatic increase from approximately $8 billion in 2015.
This escalation represents more than just fiscal strategy; it reflects a structural dependence on property transactions to prop up state finances.
What Are These Taxes?
The figure includes stamp duty, land tax, the Windfall Gains Tax, the Vacant Residential Land Tax, and numerous targeted levies affecting both investors and developers.
The government’s reliance on property-based taxes now accounts for nearly half of all state revenue—a proportion many consider unsustainable in a cooling market.
Impact on Developers and Investors
Industry experts, including the Property Council of Victoria, warn that the steep taxation regime is pushing key development projects out of feasibility.
Many sites once earmarked for residential construction are now being shelved or restructured, with planning permits being left dormant or resold.
For foreign investors, who were once significant contributors to Victoria’s housing supply, the increased surcharge and annual absentee owner taxes have had a chilling effect—leading to what some estimate as a 25% decline in offshore interest since 2014.
Consequences for Home Buyers
Buyers may feel distant from developer-level taxation, but the downstream effects are real:
Fewer projects mean reduced housing supply, especially in growth corridors
Increased costs are passed on to purchasers through higher pricing and fewer inclusions
Stamp duty remains a blunt tool, often distorting purchase decisions and discouraging upgraders
Is Reform on the Horizon?
Despite mounting pressure from the real estate sector and economists, the Victorian Government remains committed to maintaining its property tax intake.
With the Homebuyer Fund axed and no substantial relief for stamp duty on the horizon, many question whether the State’s reliance on property is placing both affordability and mobility at risk.
What Does This Mean for You?
Whether you’re buying, selling, subdividing or transferring property in Victoria, understanding the full tax picture is critical to avoiding surprises at settlement.
At Victorian Property Settlements, we provide clear, independent advice to help you navigate these financial risks—particularly in high-stakes transactions involving vacant land, off-the-plan contracts, or multiple titles.
Victorian Property Settlements – Trusted for over 25 years by Victorian buyers and sellers.
To understand how current property taxes might affect your settlement costs or contract adjustments, contact us at
📩 David@quick32.com
📞 (03) 9783 0111
🌐 www.victorianpropertysettlements.com.au