When the QLD government announced a new land tax understandably there was some push back. The proposed law meant that interstate real estate investors would have all properties that they own in and outside of QLD taken into account when determining if they meet the threshold for land tax concessions. This was swiftly met by a market reaction, with surveys claiming that 1 in 5 landlords would plan to dump their QLD stock if it became law. Given that the legislation would cause investors to sell this would create even more pressure on an already tight rental market.
Right now in Queensland we need more rentals on the market not less. We need to create incentives that will tempt investors to build and buy properties to rent out. It seems that the QLD government is in a love have relationship with property investors. A lot of people are annoyed that the rental market is tight and that they can’t afford to buy. But, these renters also need the landlords otherwise they would not have houses to live in. This law however, would have the most negative impact on the desperate renters not the landlords.
It seems that the premier backflipped not only because of the market response and the realisation that it will hurt renters but also because there was quite a bit of pressure on her from other premiers and big business too. The head of the Real Estate Institute of Queensland (REIQ) Antonia Mercorella welcomed the U-turn. Her view is that in a time when investor confidence is low and rentals are hard to come by with prices still rising it would cause unnecessary strain on the rental market. The state needs to create incentives for investors to participate in rental investments rather than trying to squeeze them. Because the only thing that will fix this rental crisis is MORE SUPPLY!
