Released a day after the government announced the commencement of its $10 billion Housing Australia Future Fund, the Per Capita report shows that the nature and focus of government housing measures has swung sharply over the past 30 years from prioritising assistance to the most needy to delivering multi-billion dollar benefits to the well-off.

The analysis found that total government spending on housing, spanning social housing, Commonwealth Rent Assistance and property tax breaks, has more than quadrupled in the past three decades from $6.4 billion to $26.7 billion.

But almost all of this growth has been driven by tax concessions for investors. The value of the capital gains tax (CGT) discount and negative gearing has exploded since the turn of the century from $1.5 billion to $18 billion in revenue foregone by government.

The Per Capita researchers estimate most of this largesse is accruing to households in the top 20 per cent income bracket, including almost 82 per cent of the CGT discount and more than 51 per cent of the benefit from negative gearing.

"Property investor tax breaks, particularly the CGT discount, are severely biased to the top 20 per cent of income earners," the report said, with average person in the top income quintile receiving $1788 in 2022-23, compared with just $73 for the average person in the bottom quintile.

The value of these tax concessions has swamped measures to assist low-income groups to the extent that they will be worth more than 10 times the amount the government will spend on social housing and homelessness services this financial year, the report said.

Per Capita executive director Emma Dawson said the Howard government turned away from direct government investment in social housing to relying on the private sector to provide homes and support tenants with rental assistance.

Ms Dawson said the effects of this were amplified by the subsequent introduction of the CGT discount which, together with negative gearing, encouraged a shift in investment from more productive areas of the economy into housing, forcing up values and increasingly pushing home ownership out of the reach of average income earners.

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"Through investor tax concessions, Treasury pumps billions of dollars every year into the pockets of people who already have considerable assets to encourage them to acquire more, pushing up the price of land," Ms Dawson said.

In the process, the government has "eschewed its role as a shaper of the housing market ... in favour of merely providing a welfare-based safety net for those the market does not wish to serve," she said.

As a result, there has been a significant decline in social housing in favour of spending on Commonwealth Rent Assistance, which subsidises rents set by the market, Ms Dawson said.

In a swipe at the CGT discount, the Organisation for Economic Cooperation and Development said that while a capital gains exemption for the principle residence might be justified, "an uncapped exemption provides vastly greater benefits to the wealthiest households and further distorts the allocation of savings in favour of owner-occupied housing".

It urged member governments, including Australia, to consider capping the CGT exemption as a way to help slow house price growth.