Build-to-rent can solve the housing puzzle
Housing industry advocacy groups have called on the government to clarify policy on the build-to-rent sector, claiming that incentives would support building more than 100,000 affordable homes.
AUSTRALIA’S stunted build-to-rent sector needs more government backing and certainty over tax rules to help solve the housing crisis.
While build-to-rent (BTR) makes up five per cent of the new builds in the UK and 12 per cent in the USA, it stands at just 0.2 per cent in Australia.
The low percentage has prompted peak industry bodies and big players to call on the Albanese government to give BTR more impetus.
National Shelter, Community Housing Industry Association and the Property Council of Australia said that build-to-rent housing could make a significant contribution to the government’s plan to build 1.2 million homes over the next five years.
Property Council CEO Mike Zorbas told the Senate Economics Legislation Committee that modifications to proposed BTR legislation could support the creation of more than 100,000 rental homes.
Uncertainty over tax changes could undermine the government’s stated intention of encouraging more rental housing, according to Mr Zorbas.
“All sides of politics know Australia is in a housing crisis,” he said.
“The average age of a first home buyer is 37 in Sydney and 36 in Melbourne.
“We can deliver 105,000 rental homes, and immediately unlock 1,200 affordable tenancies through the changes proposed and that is a big contributor to getting to our national housing targets.
“Build-to-rent is the missing piece of the Australian housing puzzle. At the time when new housing supply is desperately needed, the current settings are repelling investment. Thousands of new rental homes that should be under construction are not.
“Build-to-rent offers high amenity, secure tenure for renters in comfortable, energy efficient homes with shared facilities and community programs.
“As CHIA and Shelter agree, we must make urgent changes to the draft legislation. We hope all parliamentarians will support our proposal to significantly increase housing supply.
“We simply won’t solve the housing puzzle without build-to-rent.”
According to Mirvac, the BTR sector has all but stalled over the past 12 months, waiting the outcomes of consultation into tax rules.
“The BTR sector has almost stalled over the last 12 months, with limited additional capital entering the sector post-Mirvac’s successful raise,” Mirvac build-to-rent general manager Angela Buckley’s submission said.
“While market delivery challenges like construction costs contribute, the main factor has been investors waiting for the implementation of Managed Investment Trust legislation.”
