The Property Council of Victoria has issued a 30-day ultimatum to Premier Jacinta Allan’s government, citing a collapse in industry confidence and a critical slowdown in construction. According to the latest Industry Sentiment Survey from the Property Council and Procore, Victoria’s sentiment index has plummeted to 67 points—the lowest level since the first weeks of the Covid-19 pandemic and well below the national average of 92.
Why investor confidence is falling
The Property Council attributes the sector’s decline to a combination of high state debt, “oppressive” taxes, and anaemic economic growth. Data shows that confidence in the Allan government’s ability to plan and deliver growth has hit its lowest-ever level, dropping to negative 86.4 points from a previous negative 71.2.
Victoria is currently the only state in the country to record negative forward work schedules, with the metric sitting at negative 12.7 points. This indicates a major slowdown in the delivery of housing, jobs and the state’s poor economic growth. Furthermore, in 2026, the share of government revenue in Victoria generated from property grew by 49 per cent.
Victoria is the only state in the country to register negative forward work schedules, a measure of how quickly construction work is being assigned and completed.
The ultimatum and potential consequences
Cath Evans, the Property Council’s Victorian executive director, stated that the state’s current tax and regulatory settings have made development projects increasingly difficult to deliver. The Council is demanding an urgent plan for economic growth and renewal within 30 days, specifically calling for the abolition of investor taxes to improve the state’s competitiveness.
If the government does not implement these reforms, Ms. Evans warns that confidence will continue to stay at record lows, potentially resulting in long-term economic costs for all Victorians. Should the government fail to provide a strategy for growth, it is likely that investment will continue to depart the state, further impacting housing delivery and job creation.
The friction between the Property Council and the state government highlights a significant tension in fiscal policy. When a state relies heavily on property-linked revenue—which grew by 49 per cent in 2026—it risks alienating the very investors needed to address housing supply shortages. The 30-day deadline creates a clear political focal point for the Allan government to either signal a shift in tax policy or defend its current budgetary direction.
Frequently Asked Questions
What is the current state of construction confidence in Victoria?
Confidence is at its lowest level since the first weeks of the Covid-19 pandemic, with Victoria’s sentiment index falling to 67 points, significantly trailing the national average of 92.
What specific action is the Property Council demanding?
The Council has demanded that the Allan government produce an urgent plan for economic growth and renewal within 30 days, including the abolition of investor taxes.
How is Victoria performing compared to other states?
Victoria is the only state in the country to record negative forward work schedules, a metric currently sitting at negative 12.7 points.
What impact do you believe these tax and regulatory settings will have on the future of housing development in Victoria?
