Gold Coast City Council has introduced a “view tax” on apartment-dwellers on higher levels, sparking a reaction from Queensland’s peak real estate body.
The new scheme increases rates on an ascending scale after the fifth floor. Rates rises of 40 to 50 percent on higher level floors mean some residents could pay $676 (US$442) more every year.
Antonia Mercorella, CEO of the Real Estate Institute of Queensland (REIQ), noted that more than 12,200 high-rise units were subject to new ratings categories without any consultation, education, or phasing in.
“Colloquially known as a ‘view tax’ but certainly not commonplace in Queensland, this is an arbitrary way of raising rates masked as creating greater equity,” she said in a statement.
“It’s concerning when we’re all hoping that greater density by ‘building up’ will be part of the solution to our state’s housing crisis.”
Council Targets Fairness
Gold Coast City Council has said the new rate structure aims to ensure fairness and equity for apartment residents.
“The general rate for high-rise units will vary depending on the unit’s rate categorisation which takes into the unit’s size and floor level,” a spokesperson on behalf of Mayor Tom Tate told The Epoch Times.
“The previous method did not take these factors into account. For example, under the previous method, a first floor high-rise principal place of residence unit may have paid the same general rates as a 40th floor penthouse.”
Industry Body Critiques Tax
However, Mercorella expressed concern that it might be unfair for someone who bought a 21st floor apartment, not realising the floor below them may be subject to lower rates bills.“It’s nonsensical for a council to assign a derived value capture for views,” she said.
“Views are not public infrastructure that the local government provides which they can seek a return on investment—it’s the natural environment.
“If anything, given apartments share facilities, they are often more efficient and less taxing on council services such as roads, sewage, water, and rubbish collection.”
Mercorella said elevation did impact the sale price of properties, particularly penthouses, but said the actual value was only realised when the property is sold.
“Ultimately, the market will determine the value which will take into account numerous factors unique to that apartment building and the apartment itself,” she said.
“We’re curious to see how these floor tiers and rates categories were calculated, and whether the research stacks up against their perceived value tiers.”
Mercorella warned against councils taking note of the precedent.
“We caution councils that unexpected and unfair rate hikes based on formulas plucked from the air can erode the trust and confidence of buyers and the homeowners who are your constituents—property owners are not a bottomless money pit,” she said.
