Login
iscover
The Institute stated that the proposals from tenant advocacy groups fail to offer a long-term solution to Queensland’s rental crisis.
State capital Brisbane recorded Australia’s largest median year-on-year rent increase across units and houses, while 0.8 per cent vacancy rates in Brisbane and the wider state were recently branded as far from healthy by Real Estate Institute of Queensland (REIQ) chief executive officer, Antonia Mercorella.
These tight market conditions won’t be healed through rent control, despite Ms Mercorella admitting she understands why such calls have been made.
“We are acutely aware of the devastating impacts of the rental crisis and against that backdrop, it’s understandable that some tenants’ advocates are proposing rent control as a solution,” she said.
“But rent control is not the panacea that many argue it to be.”
She explained the state lacks “sufficient rental housing supply to meet the ever-increasing demand for rental properties and, as a result, we are living in the tightest rental market in the history of our state.”
Conceding such conditions have established a challenging environment for tenants, she outlined how rent control is a solution formed without a long-term vision that could “significantly deter property investment and reduce rental supply.”
Ms Mercorella suggested it’s “unsustainable to assume property investors will keep meeting free-market-driven cost increases such as mortgage repayments, rates, repairs and maintenance, and insurances, while artificially capped rents create a hard limit on their return to cover such expenses.”
With much of Queensland’s housing stock provided by mum and dad investors, and just 4 per cent coming from the state government’s social housing supply program, Ms Mercorella declared that “it needs to be recognised that the contribution of property investors to housing in Queensland is vital.”
“If even a small percentage of investors were to sell their properties or withdraw them from the permanent rental market, this would have a material impact on the Queensland rental sector,” she said.
As opposed to implementing rent control, she stressed the importance of fair and balanced rental legislation to “respond to some fairly exceptional circumstances.”
“Rental legislation needs to work in all markets, and it needs to be fair and balanced,” she said. “Because, on one hand, renters need to be afforded statutory protections, and on the other, if restrictions on what property owners can and can’t do become too onerous, there will be a proportion of property owners who choose to walk away.”
She described it as a “delicate balancing act” which is tricky to nail, but she noted the importance of the legislative framework is “fairly balanced and isn’t too tipped in the favour of one party.”
Last year, the Palaszczuk government enacted rental reforms that offered increased rights and protections to tenants, including “statutory constraints that relate to rent in Queensland that limit how frequently you can increase rent and provide rules around the way rent increases are implemented.
However, at the end of the day, she explained the state’s rental crisis “is not a problem that has emerged overnight [as] the number of dwellings being built in Queensland has diminished considerably over the last five years and our future pipeline is likely to fall short of demand.”
Returning to her point about balance, Ms Mercorella outlined how “until we are able to achieve a greater balance between the demand for rental housing and supply, and introduce greater diversity of housing, we won’t be able to fix this crucial problem we are facing.”
“What’s needed is a concerted effort from all levels of government to create the right environment to sustain existing established rental stock and to build new housing each year that matches targets based on detailed population forecasts,” she concluded.
You are not authorised to post comments.
Comments will undergo moderation before they get published.