Demand for a place to live remains very high, driven by population growth from mega-high migration and low but perhaps improving vacancy rates in the rental sector. We know that roughly one third of households own their own property, outright, one third own with a mortgage, and one third rent. Those in the last two categories are expanding, while those who own outright are shrinking as a proportion of the total – though with some state variations.
Over recent decades, the Government has effectively outsourced the provision of rental housing to the private sector, via mum and dad investors, who get considerable tax breaks to hold property for rent, and more recently though the rise of the so-called build to rent sector, which is being held out as a solution to the lack of property for rent.
The critical question is do we want to go further into the mire of neo-liberalism and let big international investors build homes to rent in Australia, with rents that according to Cameron Murray are typically higher than local providers, while offering even more tax breaks, to corporates, or should the Government get back into the home building game, (see my discussion with Elisa Barwick yesterday) through a public bank, and also dial back migration to a sustainable level. Ideology apart the answer seems obvious, and yet… they still want more migrations to pump GDP and more build to rent to meet a housing target which was built in fairy land.
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