Exclusive: Any attempt to use the budget measures as an excuse to raise rent is opportunistic profiteering, housing advocates say
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Australia’s peak community and housing groups have urged federal parliament to quickly pass Labor’s changes to negative gearing and capital gains tax, saying the reforms would improve fairness for renters and young homebuyers.
The government may introduce its negative gearing and CGT changes into parliament as soon as the coming sitting fortnight, with hopes of passing the legislation soon after with the support of the Greens.
The changes include limiting new negative gearing to new-builds and grandfathering existing properties, and changing how CGT is calculated: both reforms were billed by Labor as ways to rebalance the housing market toward first home buyers instead of property investors.
Maiy Azize, of housing advocacy group Everybody’s Home, said there was “no excuse for landlords to hike rents because of these changes”.
“Existing landlords get to keep these tax perks. Any attempt to use these reforms as a justification for raising rents is opportunistic profiteering,” she said.
“We urge all politicians to see through the fearmongering and back these long overdue changes.”
In a joint statement, the Australian Council of Social Service (Acoss), Everybody’s Home, Better Renting and National Shelter said the changes would “improve fairness and level the playing field”.
The social and housing groups predicted the changes would improve housing stability for renters by encouraging long-term investment in housing, over short-term gains.
It echoes arguments from the housing minister, Clare O’Neil, that limiting new negative gearing to newly built properties would help control rent prices.
Treasury modelling in the budget forecasts 35,000 fewer homes will be built over the next 10 years as investors put their money elsewhere, but the impact on rents is estimated to be an extra $2 weekly for the median renter.
The Acoss policy director, Jacqueline Phillips, said negative gearing and CGT had “supercharged inequality, driven up housing prices, and added little to rental supply”.
“We call on all politicians to back the reforms that are clearly in the national interest,” she said.
But concerns have been raised by some economists, who believe home values are set for their first national slump since 2022, as well as some in the property lobby. The shadow treasurer Tim Wilson, has pointed to modelling from SQM Research claiming Sydney rents could increase by $160 weekly, and Melbourne $130 weekly.
Labor sources said that modelling does not reflect the government’s policy, which allows homes currently negatively geared to keep using that tax treatment, and restricts new negatively geared properties to new-builds.
Treasury modelling in the budget estimates the changes would see an additional 75,000 first home buyers, and changes to regulations would support another 30,000 new homes being built, over the next decade.
Azize, from Everybody’s Home, said it was “dishonest for the property lobby to run a scare campaign and spread misinformation about reforms that will not even affect existing landlords”.
O’Neil also pointed to the government’s increases to commonwealth rent assistance in the 2023 and 2024 budgets as assisting renters.
Source: Guardian - World News
