If you’re struggling to find a home to rent in Victoria, you are certainly not alone. The Victorian government has imposed regulations and land taxes which have negatively impacted the property investment market causing rent hikes along with a mass exodus of investors, thereby creating a shortage of affordable rentals.
A recent report by PropTrack refers to a study which suggests short term rentals like Airbnb may also be contributing to the lack of affordable long term rental properties, but is that really the case?
The study focused on 13 renowned tourist hotspots around Australia, and found that short stay rentals accounted for 34.6% of the long-term rental supply pool in those locations and that Victoria’s Hepburn Shire and Apollo Bay have more short-term rentals than long-term.
In Victoria’s holiday destinations such as Hepburn Shire, Apollo Bay, the Mornington Peninsula and Warburton, we would expect short term rentals to dominate the tourist-focused market. And we can hardly blame the average property owner for trying to build future wealth by investing in high-return holiday rentals which have an important role to play in the tourism industry.
The Victorian government’s solution is to impose yet another tax, this time a 7.5% levy on short stay accommodation. They are also giving powers to local councils and owners corporations allowing them to limit or totally ban short term rentals. These short-sighted measures are likely to create a lack of short term holiday accommodation for tourists combined with a dearth of affordable long term housing for renters, in areas where locals rely heavily on tourism to make a living.
To date, the government’s housing schemes have failed to reach their targets while significant sums have already been spent on policy development and associated red tape bureaucracy. So it may be fair to suggest that any funds received from short-stay property levies and hefty land taxes might not make it into the right kitty to fund their promise to build more public and affordable long term housing.
So who’s to blame for the worst housing crisis in living memory? It’s definitely not innocent tenants nor average income earners struggling to find an affordable house to buy. It’s certainly not ‘mum and dad’ small-scale property investors trying to build a little future wealth for their kids or their retirement by investing in short or long term rental properties. You decide.
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