Out of control property taxes combined with rising costs of living are trashing the dream of homeownership for tens of thousands of Australians, according to REINSW, a major professional association for real estate agents and other property professionals in the country.

With both sides of the federal house making cost of living a key election issue, the REINSW has urged Julia Gillard and Tony Abbott to explain how they will reform unfair tax regimes that threaten home ownership for Australian families.

"Australian governments are driving up cost of living pressures and keeping thousands of Australians out of home ownership", said REINSW chief executive Tim McKibbin.

"It is not enough for both leaders to blame each other for driving up the cost of living when taxation regimes supported by both parties are killing the Great Australian Dream of home ownership.

"Worse still, the blind eye of the Commonwealth has meant that State and Territory Governments of both persuasions have been able to fleece home owners and property investors of additional revenue and at the same time kill the great Australian Dream,"

"The REINSW has launched its 'Real Tax Policy' in the middle of the Federal election campaign calling for landmark reform of property taxes across Australia, said Mr McKibbin.

According to him, in the context of a bleak global economy, it is vital that whoever wins the federal election urgently reforms property taxation at a Commonwealth and State level.

"REINSW is taking a national approach to this issue because for years successive federal governments have allowed the continuation of the stamp duty and land tax gravy train.

Mr McKibbin said the worst rort Gillard and Abbott need to urgently address is the stamp duty on GST which is the 'tax on tax'.

The REINSW Real Tax Policy seeks to prohibit stamp duty on GST, incentivise the States and Territories to slash transfer duty rates (inclusive of registration levies and other transfer taxes however named) by at least half, incentivise the States and Territories to implement annual and fair indexation of transfer duty thresholds, and incentivise the States and the ACT to reduce land tax rates and never broaden land tax to the family home (NT has no land tax), according to association's statement.

"The dream of homeownership is one of the great traditions in Australia which is under ever increasing threat from over taxation by successive governments," said Mr McKibbin.