Federal unions recently announced their intention to establish a new leasing policy, but the Real Estate Institute of Western Australia (REIWA) has stated that this proposal is contrary to the party's position in this regard. which concerns the negative gearing. On top of that, the move will probably not help to improve the affordability of homes, REIWA said.
The proposal includes a 10-year plan for the construction of 250,000 new homes across the country, and 20,000 units are planned during the party's first term.
As part of the proposal, the federal labor government would grant investors who build new homes a 15-year subsidy of $ 8,500 a year, provided that the properties are rented for 20% less than the market rent.
REIWA President Damian Collins questioned the logic behind these projects. "Why [is] Work offering rent tax offsets to people who offer new properties for rent at 20% less than the market value? Because they know that they are planning to introduce a new negative conversion policy for new construction, this will lead to higher rents as investors pull out of the market in well-established areas. " said Collins.
Collins said that, like the National Economic Plan Scheme (NRAS), which failed, it would barely solve the problems of accessibility to housing.
Collins said that the construction of 20,000 new homes in the first three years would represent less than 1% of the supply of rental housing. Rents will continue to rise, according to the law of supply and demand, he said.
"The federal government's willingness to tinker with a negative gear will have far-reaching consequences for the Australian housing market, and the proposed new project will not even be able to mitigate the inevitable fallout," Collins said.
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