NSW rental properties must be more attractive for investors: CEO

“It’s important to recognise that someone with the resources to make an investment has numerous options, all competing for the investor’s money.”

“Shares, fixed interest, offshore opportunities, managed funds, superannuation, holiday and short-term rental, commercial and industrial property are all competing with residential rental property.”

Highlighting that it’s common ground among all stakeholders that more residential rentals are needed, Mr McKibbin is urging the NSW Minister for Better Regulation and Fair Trading, Anoulack Chanthivong, to have a plan that addresses the declining growth in the number of properties available to rent.

“We know that growth in the number of rental properties in the market has been decreasing. Alarmingly, the growth went negative in May this year – for the first time in the market’s history!” the CEO raised.

Mr McKibbin said there is a need to ensure rental property numbers return to 8 per cent – the figure he said is required “to accommodate the existing demand and the thousands of new people coming into NSW each month”.

Mr McKibbin’s comments come after the coming together of national cabinet last week.

Smart Property Investment noted that prior to the meeting, there had been discussions about whether the cabinet would consider the relevance of “rent caps” to control spiralling rental prices.

Following on from that meeting, Prime Minister Anthony Albanese reiterated comments made earlier this month that he would not be asking the states and territories to adopt a national cap or freeze on rents.

The PM acknowledged that “different states have different jurisdictions with respect. They have different rules”.

But ruling out the idea of a rent freeze, he said he believed such a policy would exacerbate the issue of low rental supply.

He argued that “the key to addressing these issues is supply and that’s why we have focused our attention on supply”.

In an effort to be “practical about moving forward,” the Prime Minister emphasised that the task has “no simple one day, one week, one month solution”.

“My government is determined to fulfil our responsibility, as I care deeply about housing. The Housing Australia Future Fund was the centrepiece of my second budget reply. And … I will continue to argue that it should be supported,” he continued.

Following on from the announcement of national cabinet’s focus areas, Real Estate Institute of Australia president Hayden Groves spoke in favour of the approach to rental reform being taken by the government, lauding the striking of a balance between protecting tenants and not discouraging investor activity.

From his perspective, “the nine-point plan for renters seeks out a reasonable balance between enabling consumer protection and ensuring we aren’t overregulating and therefore diminishing the rental supply pipeline”.

It’s a sentiment with which Real Estate Buyers Agents Association of Australia (REBAA) president Cate Bakos agreed, noting that the priority areas agreed to by all levels of government shows they are “committed to increasing the supply of housing, rather than promoting punitive rental reforms that would see more investors exit the market and put further upward pressure on rents”.

Tags:

• Australia property market news roundup

Share