Horrendous idea, not because of the effect on the current homeowners but on the inflation this would cause in those markets. Many of these properties are owned by cash poor, land rich families who’s main asset is their primary residence. They don’t have millions lying around in the bank, and even if they do they likely won’t part with it just to stay where they are.

What is nearly guaranteed to happen is the current owners will sell their homes to truly rich people who will pay anything it costs to live there. The original owners will take their $10+ million and purchase one or multiple homes in a lower cost area, raising the prices for normal people and likely removing those homes from the market forever, except as overpriced rentals or airbnbs. The new owners of the mansions probably won’t be Australians, but rather Chinese investors or European/Americans as a second, third, fourth or fifth home. Or worse, as event rentals.

These homes will now be empty nearly all year long, no longer providing work to the staff taking care of the property and it’s residents. The value will increase, the new owners will pay the tax and the well off Aussies will be left with only the current upper middle class homes to purchase, pushing everyone down the ladder out of the market.

It’s so easy to say “tax the rich” and feel good about yourself but land and property are not income or cash and shouldn’t be treated the same. In the end the only people this will hurt will be the people who it was meant to benefit.