Qld government wages war on property investors

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The Queensland government has earmarked property investors as one of its key targets to squeeze for income as part of its efforts to salvage the state’s fiscal woes, says the state’s real estate institute.

According to the Real Estate Institute of Queensland (REIQ), the state government’s financial audit has outlined potential revenue-raising measures including the following:

  • imposing a $100 levy on all property owners;
  • reducing or removing the concession on land tax;
  • applying a premium transfer duty rate;
  • and increasing the landholder acquisition duty rate.

In a worrying commentary on the government’s plans, the REIQ has stated that any further financial imposts on property investors is likely to see them pull up stumps and sell their rental properties. 

In short, property owners are sick and tired of having to bail out the government, said acting REIQ CEO Antonia Mercorella.

“Property owners – and investors specifically – seem to forever be targeted by all levels of government when they are short of cash, whether it is through higher council rates, one-off levies or higher rates of stamp duty,” she said.

“The additional legislative and compliance obligations on property investors over recent years, coupled with weaker returns on investment, has resulted in many opting to sell their rental properties.”

According to the REIQ, Australian Bureau of Statistics (ABS) data shows the number of investors active in the Queensland property market has halved in the last five years, and Mercorella believes this number is likely to decline even further if investors are slugged with additional costs as planned.

“We are currently starting to see the impact of this reduced investor activity with vacancy rates tightening and rents increasing across the state. If more investors left the rental market, then this situation would undoubtedly worsen,” she said.

“If land tax thresholds are reduced or removed, the added costs would put an end to the glimmers of renewed investor activity we have seen in recent months and would also likely be passed onto tenants via increased rents.

“Also the unit and townhouse market in particular is yet to see investors return significantly with the additional costs associated with this type of housing deterring investors.”

Are you worried about the costs of owning an investment property in Queensland rising? Place your comments below, or join the debate in our property investment forum.

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  • Mich says on 19/06/2012 07:36:30 PM

    We have rental properties in 3 states - our qld one is certainly the worst for extra costs and charges. Will be doing a lot more research and asking questions about hidden costs if i was to buy in qld again.

  • Sylvia Leveris Walton says on 19/06/2012 08:26:39 PM

    I live in the northern
    Brisbane area in Caboolture and noticing that the rental market is drying up for cheaper properties and if the trend continues that investors are not investing in this area than the rents would become to expensive for this area making the affordability to rent hard seeing more homeless people it's hard as this is a low income area. Government needs more housing for the affordability scheme they should give more incentives to investors other wise it's going to be very hard to get low cost rent. Don't take the incentive's away from investors. We need them.

  • Megs says on 20/06/2012 09:46:32 AM

    This is ridiculous - it will be devastating for the QLD property market if it goes ahead. It's just one more reason for people to NOT invest in qld, which is exactly what we don't need! I own 4 properties in the state and I'm already slugged with higher council rates simply for being an investor (when I bought six years ago they were $700 per half year - now they are double that amount!) And to add insult to injury, no capital growth due to GFC and floods. Makes me wonder, what's the point?

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