How could tax changes reducing housing supply affect the state?
The state may need to adjust planning frameworks to address housing supply shortages The federal budget's tax changes have discouraged investment in residential property, leading to landlords exiting the market and reducing housing supply. This has exacerbated a severe rental shortage, with the national rental vacancy rate at 1 per cent in the September quarter. As Perth's planning framework aligns with the state's framework, the state may need to intervene with regulatory changes or planning adjustments to address the lack of stock and the resulting affordability crisis for renters.
- Effect
- Strong negative
- How direct
- Brind's reasoning
- When
- Within months
- The story
- No new developments lately
How it reaches state
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Tax changes in Perth are reportedly reducing housing supply and investor incentives. This has led to a tightening rental market, with rent increases reaching 141 per cent over seven years in some cases. Due to the tight supply, extended families and friends are increasingly grouping together to secure rental properties.
The full event1independent outlet -
The exit of landlords and reduced supply has worsened the rental market, where the national vacancy rate was 1 per cent in the September quarter. Since Perth's planning framework aligns with the state's framework, the state must address this severe supply shortage.
No report states this step directly. Brind drew it from the reporting on each side of it, so treat it as an informed guess.
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organised community living under a system of government; either a sovereign state, constituent state, or federated state
Everything about state
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The facts so far
As reported. Each one links to where it comes from.
- The federal budget's tax changes have discouraged investment in housing, disadvantaging renters.abc.net.au
- Landlords are exiting the market.abc.net.au
- The national rental vacancy rate was at 1 per cent in the September quarter.abc.net.au
- Social and community housing is only between 3 and 5 per cent of our total housing stock.abc.net.au
Why it matters
The housing crisis represents a significant economic and social challenge for the state. With only 3 to 5 per cent of the total housing stock being social or community housing, the vast majority of people needing housing rent into the private market, which is currently experiencing severe shortages.
This situation puts pressure on the state's governance structure, which must manage the planning framework that aligns with Perth's. The state must decide whether to intervene with regulatory changes or planning adjustments to stabilize the market and address the affordability crisis for renters.
What we don't know yet
- What specific planning adjustments could the state make to increase housing supply?
- Will the state prioritize addressing the needs of renters or first home buyers?
What would change this answer
— Other considerations
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Reporting
- abc.net.auSunday
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Brind's analysis is written by AI from the reporting linked above and can be wrong. This explainer is a possibility worth considering, not a forecast: steps marked as Brind's reasoning are not stated in the reporting. It is not investment advice; do your own research.