A tax could be the answer to making rent cheaper 2

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If you rent a house, than you know just how expensive it can be and how hard it can be to find a suitable home when you move.

In fact, SGB Economics and Planning’s latest rental affordability index has rated housing affordability in Australia as “in crisis”.

Executive officer of National Shelter Adrian Pisarki told NewsCorp he was concerned that Australia had no “national strategy” to overcome the issue of housing affordability.

“Low income households continue to face unaffordable rents and high levels of housing stress despite some improvements in the rental market — additional supply in capitals has not eased rental affordability for low income houses,” he said.

“We are most concerned that there is no national strategy to tackle housing affordability, especially when we see that additional supply is not reaching low income households, and increases in homelessness are being reported.”

To turn the situation around, some advocates are calling for the government to introduce a vacancy tax.

So, what’s a vacancy tax?

Well, according to NewsCorp reports, a local government in Vancouver will begin taxing property owners who leave their property unoccupied for six months or more.

As part of the tax, all property owners will be required to declare the occupancy of their properties and will be taxed 1% of the value of the property if it is unoccupied for six months of more.

According to a study by an Australian think tank last year, there are more than 80,000 unoccupied homes in Melbourne and more than 90,000 in Sydney.

SGS Economics & Planning senior associate Ellen Witte told NewsCorp that if such a tax were introduced here in Australia, it would encourage more people to rent out their investment properties.

“Where property owners do not (rent out their properties), the tax revenue could be used to reinvest back into affordable housing,” she said.

But even then, it might not be enough to address housing affordability on a larger scale.

“It’s a wider problem than that, this would by no means be a measure to address the wider affordability issue,” Witte said.

“It needs a multi-layered approach. We need review and reform of the existing Australian tax regime, especially around capital gains tax rebate and negative gearing, and that’s really to make the housing market more attractive to first home buyers and take out some of the inflationary forces that is created by those tax measures.”

What do you think? Does it sound like a good idea?

 

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The Starts at 60 writers team seek out interesting topics and write them especially for you.

  1. What a silly, silly article !! I notice that the Starts At 60 author was not game or too
    embarrassed to put their name on it. 80,000 vacant rental homes in Melbourne and
    90,000 in Sydney, what a complete load of ‘hot cocky’s droppings’ !!! Try to find one
    in either city … apart from those between leases, on the current selling market or being renovated.
    “Vacancy tax” = “cheaper rents” = “greater housing affordability” … what planet do you
    live on you, you twit !!!

  2. It is always very easy to find a person to advocate, taxing people. Before such statements are made, the person should do a study to find out why there are vacant places in the countries. Some people have, holiday homes, they use to go for holidays. Some have weekenders, to get out of the rut. Some people who can afford, to buy properties for their children, so that the children will have a place to live, when the are adults, married & want to settle down. Why wait for 15 to 25 years, for the children to pay millions to buy a property, when it is possible to buy for less than 10% of the price in another 15 to 25 years. Few of my friends parents, bought a property for less than $150,000 in 1985 in the Inner West of Sydney, which helped their children. If it is to be bought now, they would have been looking over $2 million. Some even have properties, unable to find good tenants. NSW has close to 8 million population. 90,000 unoccupied homes are not a big deal. So, Ellen Witte, don’t look from one eye. Use both eyes, and if you have a brain, use it too. This is not a WELFARE state. Some parents use a part of their income, to educate the children & make sure they will have a place to call home, without wasting what they have at the Casinos, gambling or drinking. I hope, another so-called “Expert”, will not recommend, to tax the Bank accounts too, if someone has a bit more money in a Bank. Vancouver is in British Columbia, Canada, & the population density of 50% more than Australia, with 4.76%/km2, and half of the land is Rocky Mountains, with a land size of 925,000/km2. Australia is 7,740,000/km2, with over 90% nearly flat land. We are not short of land, but we are only short of good politicians, who wait to get the pension. We only lack a vision to develop land & provide facilities to build housing, instead of more & more tax. Our politicians are only good at selling the state assets, and leave nothing for the future generation, and expect to rule on income, received by taxing. Time to start a Housing Development. like in Singapore, & offer the newly married, housing, to be paid off with a part of the Superannuation and part with income. Then the housing will be much cheaper than the GREEDY developers ripping off first home buyers.

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