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Groupthink like the evasive thinking of the Robodebt cabinet which avoided legal advice that would have, and ultimately did, tell them they were breaking the law. And this despite the pleas of constituents over four years.
If this happens in the highest counsels of the land…
attempt to keep private landlords (are there any others?) in the market
There are corporate landlords. A few years ago, during the Global Financial Crisis, Meriton started letting apartments that they found difficult to sell. And Mirvac, among others, are major players in the build-to-rent sector.
Major, but not dominant, as they are in Europe especially given the amount of money super funds have that need a home and the nature of their long term liabilities to fund members. There must be a reason they aren’t bigger players. Are they myopic about good deals? Is land tax the problem? I understood Mirvac’s offerings were more like resorts, hardly a major need presently.
Two months before each lease expiry date, the practice of an agent I know is to offer a rent increase of $x if the tenant signs up for a similar term or $2x if they don’t commit to a term. That seems less cumbersome than tying the figure to any sort of tax deductions administration complexity.
Given the increasing burden of land tax, not to mention the opportunity cost of not putting or keeping the money in the bank, contrary to what many people think, all the tax concessions do is attempt to keep private landlords (are there any others?) in the market. Keep sticking pins in them and see what they do.
How about if, at the beginning of every financial year, landlords who wanted to take advantage of negative gearing agreed not to raise their rent in the next 12-month period? And if they didn’t sign up for that, then “market forces” would determine their rents (provided they took Airbnb out of the equation).
In a market with many buyers and sellers, “market forces” determine the price all the time. Politicians seeking your vote may tell you otherwise. But measures designed to prefer one class of constituent to another usually backfire over time.
The market is the best controller of rents. When the legislature intervenes, it is favouring one party or class of people over another.
I see your point but isn’t allowing market forces to dictate rents favouring the fortunate over the unfortunate?
Yes. But whose job is it to level that playing field? Do the same expectations apply to sales requiring a vendor to accept less than the highest bidder is offering?
The market is the best controller of rents. When the legislature intervenes, it is favouring one party or class of people over another. How is this justified? If a prospective tenant is prepared to pay more rent at the end of an agreed term, why should the current tenant be preferred?
It is fascinating to watch governments announce legislative means to address problems that emerge from commercial realities in the hope the punters will overlook the more difficult (i.e., costly) remedies that would make a difference. So a tight rental market, caused in part by governments abandoning their role in providing public housing is met with adding to the regulation of the private rental market. Action taken—next problem!
According to https://tinyurl.com/22cvjsmo the private rental market is broken. And if more rentals will be needed in the future, where will the investors come from when, apparently, more investors are leaving the market than joining it?
If the new commissioner’s passion is the homeless, is this the time to favour those with homes already?
Once upon a time, social and affordable housing was the responsibility of the state. Including some provision for it in individual developments means the burden has to be borne by the project and not by everyone. This may be politically attractive but is it right? Nor is it the best way to manage the issues which arise and ensure that the dwellings are occupied by those currently needing assistance.
Governments are quick to find (often counterproductive) legislative remedies to problems in the rental market. Unlike GST, the land tax component in rent is not disclosed to tenants. But the tax still intrudes out of sight as government becomes the silent partner in the transaction often as the biggest single annual expense.
Your podcast conversation on holiday lets suggests investors are coming back into the residential letting market and restraining Airbnb and rent bidding is “the solution”. https://www.pexa.com.au/content-hub/ suggests times are not that rosy. And how can the rental market cope with increasing land tax which is sometimes in excess of the GST equivalent of the rent without distorting the market in favour of owner-occupiers?
So called anti-landlord legislation does not affect most landlords but land tax bracket creep must be impacting those thinking of entering the market. given the siren call of super concessions.
Embedded networks are clearly uncompetitive and only advantage the retailers. As one new to the concept, I can’t understand how they still exist given the constant political attention to the burden of energy costs.
There is a change in the air. As renewable energy rolls out, it is going to be more important to respond to fluctuations in supply to avoid having to unnecessarily overprovision for that supply. The traditional off peak times are an anachronism tied to the days when all our electric energy came from fossil fuels. Yet retailers still charge this way. Now the best time to buy energy can be in the middle of the day when the wholesale price can be as low as 5 cents/kWh.
In Sydney, I buy my power from [company name redacted] which gives me access to wholesale prices (12 cents on 15 February at 1045 hours) in exchange for a flat monthly flag fall) This requires a smart meter and an app but will be how electricity is consumed and billed for more people in the future.
The supply charge should be dealt with by a separate charge to the body corporate for supply only with each occupant being billed for their usage. Choosing the time unit occupants use higher load appliances is limited but there is scope nevertheless.
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When allowing for vacancies, not knowing much about your “guests” and general management hassles, is B&B really worth the pain when, if you a picky with tenant selection, you are likely to keep the chosen one indefinitely ticking over quietly?
Fo
@JimmyT said:
@Listohan said:
Can someone please explain. What rent loadings apply to short-term whole apartment letting, to makes it attractive.It depends where you are but if you are in an area that’s popular with tourists, you can double your rental income by renting your property for eight months of the year to permanent residents then put tourists in for the summer months.
Four month lease(s) to locals followed by a full house for the rest of the year? That does not sound attractive to an old time landlord when the management hassle free life of keeping a permanent tenant “permanently”, even at a lower gross rent, is the alternative does not sound attractive.
As an ungeared landlord of the same house in the inner suburbs in Sydney for over 40 years, it could be said I am here under false pretences. But the economics of property investment (for income rather than short term gain) must be the same for houses and apartments. Given the vacancy factor and other management issues, I cannot imagine how short term letting can ever be more attractive than catering to people who stay for years. Can someone please explain. What rent loadings apply to short-term whole apartment letting, to makes it attractive.
I should also say we have relied on short-term lets when travelling in Europe and plan on doing so again this northern summer. I would be very sad if authorities in Europe were prohibited from offering this service there.