The Property Council of Australia said the Labor Party's downfall during this year's election was its negative gearing and capital gains policies.
In a statement, the Property Council said Labor's policies would have hurt the economy and cost construction jobs. This came after the release of Labor's federal campaign review.
"Labor's review is focused on campaign tactics rather than the harmful economic impacts of their negative gearing policy Achilles heel," said Ken Morrison, chief executive of the Property Council.
Morrison said Labor's policy would have shrunk the economy by $1.5bn and would've cost the construction industry $766m.
Also read: Everything you need to know about negative gearing
"At a time of declining housing construction and a slowing economy, these changes could have been catastrophic for the housing sector," Morrison said.
A study undertaken by Deloitte Access Economics and commissioned by the Property Council maintained that Labor's policies on negative gearing would have made investors ditch the housing market.
"Our polling also found that Labor's negative gearing and capital gains tax policy was an important reason why people didn't vote for Labor in key marginal seats around the country. Australians have now rejected Labor's risky changes to negative gearing twice," Morrison said.
Given this, Morrison urged the Labor Party to rethink its stance on negative gearing and capital gains.
"The question remains: does the Opposition still support a policy that would shrink the economy by $1.5bn, cost nearly 8,000 jobs and lead to less new housing being constructed? As Labor continues its policy review process, it should ditch changes to negative gearing once and for all," he said.
