A 1% increase in Consumer Price Index (CPI) figures has placed further pressure on the 1.2 million households already struggling to afford rent and mortgage payments, according to the Housing Industry Association (HIA).
Rents increased by 1.6% during the September quarter. HIA managing director Dr Ron Silberberg said investment incentives for new, affordable rental accommodation are urgently needed.
HIA has called for a doubling of the depreciation allowance on new, ‘positively geared’, affordable rental accommodation.
“The decline in residential investment is in part a consequence of the growth in taxes and charges levied on new dwellings,” said Silberberg. “Also contributing to the decline in residential investment are solid returns from superannuation funds and international stock markets.
“Quite simply, there are too many taxes and charges levied on new dwellings, which are pushing investment elsewhere and forcing investors to charge higher rents.”
In conjunction with National Shelter and several other organisations, HIA has developed a National Affordable Rental Incentive. The aim of this is to increase the supply of new affordable rental housing by at least 15,000 dwellings each year.
“The private rental market is a disaster zone and requires each level of government to make a commitment to repairing the availability of rental housing,” said Silberberg.
“Tax cuts promised by both sides of federal politics aren’t enough. Only initiatives that reduce taxes and charges on the supply of new dwellings and incentives for investment in affordable rental accommodation will provide the assistance that’s now desperately needed.”
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