Looking at what needs to be done to fix the rental shortage
How We Can Fix the Rental Shortage,
Welcome to our blog, How We Can Fix the Rental Shortage,
Dear readers, I believe that the rental shortage can be fixed, if we
look at the reasons why this has happened. But the main reason, I believe it is
because today there is not enough money in renting properties, and a lot of
expenses and problems. This is not what most people want to hear, but we must
accept that this is the truth, because if there was enough money, there would
be lots of people wanting to own properties, and lots of properties for
rent.
Anyhow, in this article, we are discussing what are the main causes, and
then, what could be done to fix the rental market. I know that what I am
writing here is my personal views of the situation. But even the views of a
single bloke can sometimes help find a solution. Anyhow, I have been following
the rental market shortage for a while, and in my lifetime, I have been renting
one or two properties myself, perhaps then it was easier than today to rent a
property, but even then, it was not easy. Anyhow, I know something about
rentals and the problems that people encounter, so, I want to see if there is
something that I can suggest how to improve the situation, but it seems to me
that today there is no quick fix option, and I believe that if we don’t do something
about it soon, it may even get worse, because prices will continue to increase
on the rental market.
One of the reasons of course is that there are not enough houses or unit
being built, and until they build more houses and units this shortage will
continue, and the prices of houses and rental will continue to go up, but that
is not easy to do, because there is also this skilled labor shortage and other
financial problems.
Today it seems to me that this problem is not going to go away by
itself, like it did in the past, when everything was more balanced and
affordable. Therefore, it needs to be studied and fixed by the governments of
the day. But most times the people that we send to the government, instead of
looking at the reasons why this is happening and find a solution, they blame
the landlords, when the landlords find it hard to stay on the rental market,
because there is not enough money to run the business, and one of the reasons,
is that there are too many levies to pay. Then the price of the properties goes
up, and to build a new building costs a lot of money, that is hard to
recuperate during the usefulness of the building, it seems all a chain reaction
that continues, and needs to be balanced and fixed, if we want to go back to
normal rental affordability, so, what needs to be done?
What we believe needs to be done.
I believe that what needs to be done, is to look closely at what was
different when there were enough properties on the market, and somehow there
were enough rental properties being built, and somehow, they were able to keep
pace with what was needed. Today we blame the government that lets too many
people come to Australia, but I believe that, this is only part of the negative
situation, and it needs to be balanced. In fact, in the past it seemed to be a
good thing that people came to Australia, at a steady pace, and the economy was
running along well, because there was enough work for the building tradesmen,
but that equilibrium has been lost today. So, it would be good, if we can find
a way to balance those needs.
Anyhow, to make the right decisions we must look at the reasons, why
today the rental shortage is this bad, because in the past there has not been a
rental shortage so severe, so, what are the reasons?
One of the reasons is the governments greed that charge too many high
levies on rental properties, and the landlords are forced to pass in on, they
cannot run a business at a loss. Sometimes what they do is evident, at other
times it just happens, and they do nothing to fix it, because they collect more
money. One of these examples can be found hereunder, where the Queensland
government collects more money, just by not changing the land tax threshold.
Which we are going to show you hereunder.
One of the issues is the land tax.
AS I have said, one of the issues is the land tax levy, that these days
is too high. (So, here I quote from what I found on the internet)
From the internet
Taxpayers would need to pay $1 billion each year to give landlords the
tax breaks they desire, Queensland government modelling shows.
The Treasury analysis comes in response to lobbying from the Property
Owners Association of Queensland and the Real Estate Institute of Queensland
(REIQ) to reduce land tax on landlords.
The Property Owners Association wants the state
government to raise the tax-free threshold on land values by 200 per cent,
from $600,000 to $1.8 million.
Treasury modelling shows the proposal would cost
the budget $1 billion a year over the next four years.
The REIQ wants land tax thresholds indexed to keep
up with inflation since the threshold has not changed since 2008.
A Treasury spokesperson said the proposal would
cost taxpayers hundreds of millions of dollars each year, rising to $400
million in the 2027/28 financial year alone.
"Land tax is a critically important part of
Queensland's revenue base," the spokesperson said.
"It pays for things like new roads, hospitals
and schools, and it pays the wages of nurses, teachers and police officers.
"Even so, Queensland has one of the most
generous land tax thresholds in the country."
Treasury analysis shows 0.9 per cent of
Queensland's population pays land tax, disproportionately affecting people who
own multiple investment properties.
Land tax does not apply to homeowners who live in
their house as their principal place of residence.
(End of quote)
What we have said above, is only one of the charges
that the landlords must pay, and there are many other fixed expenses that the
landlords must pay, so, do not blame them for the high rent, they need to run a
business, and to run a business one must make money, or at least break even,
otherwise they will go broke. This indicates what needs to be done to fix the
rental market.
I could say many other things about charges and running cost, but this article is becoming too long, so, I need to write another article soon, about the cost of running a rental property, and other things, See you soon.
To see more click on this link,
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