New govt must tackle housing: HIA

The housing industry is urging whoever forms government after the September 7 election to embrace policies to boost home building.

Wednesday's leaders' debate saw Prime Minister Kevin Rudd and Opposition Leader Tony Abbott quizzed on the fact that 25,000 fewer homes are being built a year and there is about 40 per cent tax on a new home.

Housing Industry Association (HIA) chief executive Graham Wolfe said housing was clearly on the mind of voters in terms of the lack of new job creation in the sector and the upward pressure on housing prices.

"What we didn't see, however, was enough detail from either party as to how they will tackle these problems in a future parliament," Mr Wolfe said in a statement on Thursday.

"It is essential that whoever wins and forms government embraces policies to promote a housing-led recovery in the Australian economy."

Recent industry forecasts point to a 4.2 per cent fall in national housing starts in 2013/14.

Mr Wolfe said new home building had a significant multiplier effect throughout the wider economy, including in manufacturing.

"Big gains can be achieved even with a modest dose of targeted government policy reform," he said.

In a 50-point plan released earlier this year, HIA calls for taxation reform that would assist states and territories to remove stamp duties on housing, alongside economy-wide tax reform that looks at the goods and services tax.

It also calls for a review of the banking sector and a Productivity Commission inquiry into the cost of housing.

During Wednesday's debate, Mr Rudd said the key to confidence was low interest rates.

"If you've got interest rates out of control, frankly it really is a huge killer for the sector," he said.

Mr Abbott said the coalition would help by abolishing the carbon tax and reinstating the Australia Building and Construction Commission.

"I know this is not a total and full answer but it's a beginning," he said.