When is enough enough? Protecting landlords is crucial to solving Victoria’s rental crisis
Opinion: Affordable rental accommodation is an essential piece of solving Victoria’s housing crisis puzzle – but crushing landlords under the weight of reforms that prioritise tenants is not the answer, writes head of Victoria for Belle Property and Hockingstuart Anthony Webb.
The state’s once robust property investment market is all but a distant memory, thanks to a raft of new rental reforms, along with crippling land tax, high interest rates and a rapidly expanding population.
This has resulted in an unprecedented exodus of property investors from the Victorian market. In June 2024, there were just 654,717 active bonds in Victoria – 3.2 per cent fewer than the year prior.
Based on these numbers, the withdrawal of property investors from Victoria’s market has resulted in 22,000 less properties available for the tenants who need them.
No one will argue that renters don’t deserve safe and secure homes, but recent reforms have come at the expense of landlords. This is bad news for both sides.
If the state government is serious about activating rental supply and keeping a roof over tenants’ heads, then improving the Victorian property investment landscape for landlords is crucial.
Shift the narrative
At almost every turn, with every reform and regulation, the state government is pitting tenants and landlords against each other. It doesn’t need to be this way. In fact, continuing this narrative will do nothing in the long term to solve the housing crisis.
The solution does not lie in prioritising one party over another. Instead, it requires the state government to work with both parties to achieve the common goal of getting people into rental properties.
For landlords, it’s also about pinpointing the benefits of residential property investment and educating them on the ways they can step into the market and stay there. Surprisingly few landlords are fully across the tax savings that come with property investment.
The state government should do more to educate the sector to encourage more investor activity, and ensure all stakeholders, including real estate agents, are kept informed and provided guidance about any new changes to regulations.
Stamp duty concessions
Not all the state government’s recent property market reforms have failed to hit the mark. The new temporary stamp duty concessions for off-the-plan apartments and townhouses will help stimulate supply and may even encourage more investors into the market.
But for stamp duty concessions to be a truly effective long-term tool, we must look at the costs and taxes that pushed landlords out of the market and stripped supply in the first place.
The land tax burden
Reducing land tax needs to be the priority. Spiralling land tax bills are a key factor pushing investors out of Victorian real estate, and the rental market is suffering as a result.
Reducing land tax is not about lining the pockets of landlords; it is about incentivising investors to put their money back into Victorian property to accommodate the proportion of the population who will always need or want to rent their home.
Loosen eviction regulations
No one wants to see tenants evicted for trivial reasons or taken advantage of, but providing a level of certainty and confidence for landlords also serves a vital a role in maintaining and expanding rental supply. Changes announced in October that make it more difficult to evict tenants are contributing to a crisis of confidence among Victorian landlords.
Some checks and balances need to be applied to these new eviction laws, allowing landlords to reclaim some level of control over their property. This can be achieved without putting tenants at risk of unfair eviction.
It’s time to stop seeing landlords as part of the problem and instead treat them as a powerful part of the solution. Enough is enough.
Anthony Webb is the head of Victoria for Belle Property and Hockingstuart and has a real estate background spanning more than 20 years. Responsible for driving successful results for 50 Victorian offices, Anthony is a leading property commentator who can speak to the industry’s many, fast-moving facets. Having worked in both sales and property management, along with being a qualified auctioneer, he brings a holistic view of the real estate business and a determination to really make a difference.