Treasurer Scott Morrison's second budget is just weeks away and the Coalition has signalled a housing affordability package will form the centrepiece of the May 9 economic statement.

Mr Morrison and his colleagues are grappling with policies that could allow first home buyers to use their super for a home deposit, a possible reduction in the capital gains tax discount and other measures.

But as the government prepares its housing package, Opposition Leader Bill Shorten and shadow treasurer Chris Bowen will on Friday announce seven measures to tackle Australia's "housing affordability and homelessness crisis".

Labor's proposals are on top of its promise to limit negative gearing tax to new properties and reduce the capital gains tax discount, and are designed to reframe the national debate on housing affordability.

Mr Shorten said, ahead of the announcement, the Coalition had for years refused to reduce housing tax concessions and the risks of increased borrowing by super funds.

"Building on our existing proposals to reform negative gearing and capital gains tax, Labor is announcing new policies to improve affordability, increase supply, boost jobs, and reduce the economic risks associated with distorted investment decisions," he said.

A tax that would slug investors who leave properties vacant would be introduced in all major cities via the Council of Australian Governments process.

Such a scheme was recently adopted by the Victorian state government.

Foreigners who want to invest in homes would see the application fee double, from as much as $20,000 to $40,000 for houses worth $2 million to $3 million.

Financial penalties for foreigners who break investment laws for property will also double, with criminal penalties rising to $270,000 for an individual and $1.35 million for companies, and civil penalties also rising. Taken together, these steps will raise about $100 million extra per year.

The most significant measure is a future Labor government placing limits on borrowing by self-managed super funds to buy property. This is the only recommendation in the Murray Review of the financial system the Coalition government has not adopted, and was also was backed by the Reserve Bank.

This move will be sold as a financial stability measure, and comes in response to an 860 per cent increase in self-managed funds using limited recourse borrowing since 2012, which reduces their risk when they invest in property and which Labor argues has made buying a home harder for would-be first home owners.

Mr Shorten said restoring the general ban on direct borrowing by superannuation funds would "help cool an overheated housing market partly driven by wealthy self-managed super funds. This has seen an explosion in borrowing from $2.5 billion in 2012 to more than $24 billion today."

At the time the Murray review made the recommendation on super funds, the government said "while the government notes that there are anecdotal concerns about limited recourse borrowing arrangements, at this time the government does not consider the data sufficient to justify significant policy intervention".

Labor has also pinched an idea backed by the Treasurer but not yet formally announced to establish an affordable housing finance corporation, using a so-called "bond aggregator" model, which would help build affordable rental and social housing.

About $88 million would be spent on a new "safe housing fund" for people escaping domestic violence and those at risk of homelessness.

Finally, the National Affordable Housing Agreement, which costs the federal government $1.3 billion a year and which Mr Morrison has signalled could be axed in the budget, would be renegotiated by Labor to get better outcomes, a Housing Minister would be re-appointed and the National Housing Supply Council would be re-established.

The second round of housing affordability measures from Labor comes as capital city house prices, particularly in Sydney and Melbourne, continue to rise rapidly and as the Australian Prudential Regulation Authority has cracked down on investor loans.

Since September 2013, when the Coalition came to power, prices in Sydney have increased by nearly 50 per cent and by more than 30 per cent in Melbourne.

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