New South Wales (NSW) Labor has promised to deliver a $30 million (US$21 million) build-to-rent pilot scheme to increase the supply of rental homes to tackle the growing affordability crisis ahead of the next state election.
“Boosting supply and delivering more affordable rental housing in the regions.”
The pilot program would build “urgently needed” rental homes on the South Coast.
Properties would be built on government land by Landcom, the state-owned land and property development organisation, and Labor said they would be obligated to keep at least 30 percent of residences as affordable or social housing.
The collected rents would also be reinvested into more social housing.
Treasurer Matt Kean criticised the election promise as “very modest”.
He noted that the current government already has a similar scheme with 12 build-to-rent programs, including 500 units in central Sydney.
Meanwhile, the Urban Development Institute of Australia NSW (UDIA NSW) has called on both Labor and Coalition parties to deliver the state’s share of new homes under federal Labor’s National Housing Accord.
“Build-to-rent is a growing sector in Australia, providing increased security of tenure alongside high amenity. It will form an important part of our future housing supply, attracting long-term institutional investment to the market”
It comes after the state Labor party offered to cut stamp duty for 46,000 first-home buyers.
Minns promised that if elected, he would waive stamp duty for homes valued up to $800,000 (US$550,000).
As a result, residents, particularly in Sydney, have struggled with spiralling housing affordability. According to the 2022 edition of Demographia’s International Housing Affordability report, Sydney ranked as the second-least affordable city in the world to buy a home.
This has pushed many residents into the rental market, which drove rental growth to record highs in 2022.
Greens housing spokesperson Jenny Leong said the rental system was “broken” and expressed disappointment at the state Labor and Coalition governments for voting against the Greens’ rent freeze bill.
Rental Crisis
Footage recently emerged on social media showing the long queues of people waiting to view rental properties.Ciara O'Loughlin, who moved from Ireland to Sydney over the new year, filmed her experience of hunting for rentals after she was confronted with enormous queues.
According to property researcher CoreLogic, national rent values have increased by 22.2 percent since September 2020, the most significant rental upswing on record.
In 2022 alone, the growth reached a record high of 10.2 percent due to low vacancy rates, which slowed towards the end of the year.
The slowdown in rental growth in December was attributed to a rise in supply, but Owen was unsure if the downward trend would continue.
“It is not entirely clear whether the rental market will continue inching toward a turning point or if this is a temporary, seasonal reprieve due to higher new listings through December,” she said.
