Australians have woken up to a government plagued by uncertainty after a stunningly close general election failed to deliver a clear winner, raising the prospect of a hung parliament.

The gamble by prime minister Malcolm Turnbull to call a rare early election may have failed, with his conservative Liberal Party-led coalition on track to lose a swathe of seats in the House of Representatives - and potentially control of the country.

On Sunday, a day after the election, the race remained too close to call, with postal ballots and early votes yet to be counted. Still, Mr Turnbull sounded a confident tone during a speech to supporters.

"Based on the advice I have from the party officials, we can have every confidence that we will form a coalition majority government in the next parliament," he said.

Parties need to hold at least 76 seats in the 150-seat House of Representatives to form a government. When the count was suspended early on Sunday, the Australian Electoral Commission said the centre-left opposition Labor Party was leading in 72 seats, Mr Turnbull's coalition in 66 seats, and minor parties or independents in five seats. Counting was less clear in another seven seats.

Though the initial count showed Labor ahead, postal and early ballots have traditionally favoured the conservatives, meaning Mr Turnbull's party is likely to gain seats once those are factored in. The final tally is not expected to be known until Tuesday.

Opposition leader Bill Shorten did not speculate on a Labor victory but celebrated the strong swing to his party just three years after it was convincingly dumped from power in the last election.

"Whatever happens next week, Mr Turnbull ... will never again be able to promise the stability which he has completely failed to deliver tonight," he told cheering supporters.

Given the close result, just two possibilities remain - Mr Turnbull's coalition will win by the slimmest of margins, or there will be a hung parliament.

Independent MP Andrew Wilkie said Mr Turnbull telephoned him on Sunday morning, apparently because the prime minister was contemplating a hung parliament.

Mr Turnbull called the early election - dubbed a "double dissolution" because both houses are dissolved - in a bid to break a legislative deadlock over a bill that would have created a construction industry watchdog.

But the result of the election may bring further deadlock: If neither party earns a majority of seats in the House, both Labor and the coalition will be forced to try to forge alliances with independent lawmakers to form a minority government.

Hung parliaments are extremely rare in Australia, with only two since 1940. The most recent was in 2010, when then prime minister Julia Gillard's ruling Labor Party was forced to secure an alliance with the minor Greens party and three independent MPs, including Mr Wilkie, to form a fragile minority government. Three years later the coalition swept to power after winning 90 seats.

 

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