ADJOURNMENT

Mr BOYCE (Flynn) (19:50): Australians have now endured 16 crushing interest rate increases under this Labor government. Why? It's because this government has spent too much, taxed too much and put far too much upward pressure on all prices.

Leading economists across the nation have issued clear, unequivocal warnings: this government is actively making the Reserve Bank's job harder. Dr Shane Oliver hit the nail on the head when he said the government should be cutting spending rather than going down the endless rabbit hole of tax fiddling. Labor cannot keep hiding behind the Reserve Bank, shifting the blame for high interest rates, while Canberra continues to pour fiscal fuel on the inflation fire.

Whether rates go up or stay on hold, the underlying reality for struggling families does not change. Inflation remains too high, interest rates remain too high and this government has completely lost control of the budget and the economy. Nowhere is this economic failure more glaring than in the housing market.

Labor has delivered what can only be described as the trifecta of failure: fewer homes, higher rents and a total collapse in market confidence. We've seen reports that Westpac mortgage applications plunged by 20 per cent following Labor's budget. That is a massive red flag.

It is a clear warning that buyers, builders and investors are losing faith in the future of Australian housing. That matters because a weaker housing market doesn't just impact balance sheets or investors. It hits hardworking Australian families who did everything right to buy their very first home.

Many of these young Australians purchased properties with thin deposits, and they are now staring down the very real, very frightening prospect of negative equity as property values retreat from their March peak. For families who took advantage of the government's five per cent deposit scheme, that exposure is severe. When you start with just five per cent equity, it doesn't take a massive fall in property value to wipe out your life savings and leave you completely underwater.

Yet, remarkably, the government's own assistant minister demonstrated an alarming lack of basic economic understanding on national television while trying to defend this very scheme. Appearing on News24, the assistant minister claimed that, because 99 per cent of participants were making their repayments on time, 'they can't be in negative equity'. Now, this is completely wrong.

Negative equity is not about whether you can make your mortgage repayments on time. Negative equity occurs when the total amount owing on your mortgage exceeds the market value of your property. A family can meet every single payment without fail and still find themselves buried under negative equity if home values fall.

This isn't an entry-level oversight. The assistant minister holds a Bachelor of Economics and spent years in Labor's economic team covering Treasury and financial services. Labor actively encouraged young Australians to take on highly leveraged mortgages, and now they try and spin the falling property values as a positive for affordability outcomes.

The minister responsible ought to understand the immense financial risk his government has created for these young families. These families followed the rules. They saved their deposit, entered the market and bought a home to raise their children.

Yet now they are left financially exposed by a government that treats falling home equity as a policy success. Australians do not celebrate watching the value of their family home crumble. Yet Labor persists with policies that destroy housing investment at the exact moment when we desperately need to build them.

Labor's own budget forecasts reveal their tax changes will lead to 35,000 fewer homes being built. Economists warn that suppressing mortgage demand leads directly to fewer transactions, less construction and a tighter, more painful housing supply crisis. You cannot solve a housing shortage by taxing investment, smashing market confidence and making it harder to build.

Australian families deserve a government that focuses on the fundamentals—building more homes, bringing inflation down, taking the pressure off interest rates and restoring confidence in our economic future. They need a government that supports and backs Australian aspiration, not punishes it.