Property Council urges Senate to support build-to-rent legislation to boost housing supply
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The Property Council of Australia has called on federal opposition parties and independents to back legislation that could potentially deliver 160,000 new rental homes across the country.
The government’s build-to-rent (BTR) housing legislation, currently before Parliament, aims to create a level investment playing field by reducing the managed investment trust withholding tax for BTR assets to match rates for other investments like offices, shopping centres, and hotels.
Property Council Chief Executive Mike Zorbas emphasized the crucial role BTR housing can play in addressing Australia’s housing shortage.
“We desperately need more homes in Australia, across the full spectrum – from social and affordable housing, to market rental housing and to homes for people to purchase,” Zorbas said.
With rental vacancies at historic lows nationwide, Zorbas warned that delaying the legislation could worsen supply and affordability issues.
“The longer we delay, the longer it will take for Australians to live in secure, stable and high-quality rental housing that is purpose-built for them,” he said.
The Property Council cited 2023 modelling from EY, which showed that implementing a 15 per cent managed investment trust (MIT) withholding tax rate, along with an incentivised rate of 10 per cent for projects with affordable housing, could lead to the delivery of 160,000 homes over 10 years.
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Zorbas highlighted the potential of BTR housing to provide stable accommodation for Australians saving for their first home or choosing to rent, noting that the average first home buyer today is in their mid to late 30s.
“We need all parties to recognise the essential role BTR can play as a pathway to more stable household savings and faster savings for future home ownership,” he said.
The Property Council, which represents major global investors in BTR housing and leading players in Australia’s emerging BTR sector, has been advocating for a decade for an investment regime that attracts institutions to BTR housing by ensuring investment parity with other property types.
Zorbas urged swift action on the legislation, stating, “If the draft of the legislation is amended, it could unlock 160,000 rental homes by 2023. That is the gold medal outcome that Australians need.”
The call comes as Australia grapples with a significant housing deficit, highlighting the potential role of BTR in addressing both supply and affordability challenges in the rental market.