Calls for shake-up as Qld build-to-rent apartments fall behind

Queensland’s future pipeline of build-to-rent apartments is severely lagging behind major states, with a peak industry body calling for a shake-up to pump out much needed development.

Queensland’s future pipeline of build-to-rent apartments is severely lagging behind major states, with a peak industry body calling for a shake-up of state government incentives to pump out much needed development.

Analysis by consultancy EY, commissioned by the Property Council, revealed Queensland had nearly 1800 build-to-rent apartments under construction, with 771 more in the planning phase — far behind the 8142 and 2826 on the planning books of Victoria and New South Wales respectively.

Treasurer Cameron Dick recently announced incentives for investors including exemptions on foreign investor land tax and duty surcharges for two decades, and a 50 per cent land tax discount for 20 years on the proviso 10 per cent of units are set aside for “affordable housing”.

An artist's impression of the build-to-rent apartment building at Brisbane Showgrounds.

The showgrounds building is to be developed by Lendlease and QuadReal Property Group

Government analysis showed the build-to-rent incentives as proposed could result in an extra 3000 build-to-rent dwellings over the next four years.

Property Council of Queensland executive director Jen Williams said the incentives would go a long way in making this housing option more feasible in the state for investors, but called on the government to uncouple the affordable housing catch from the concessions as Victoria had done.

And that rental subsidies should be considered instead for the portion of dwellings to be rented at below-market rent.

“Agreement on what is considered ‘affordable’ and limitations on how some companies can invest their shareholders’ money, could create limitations on the uptake of the Queensland Government’s great initiative,” Ms Williams said.

Jen Williams from the Property Council. Picture: NCA NewsWire / John Gass

QShelter executive director Fiona Caniglia said the housing organisation was supportive of the government’s push to unlock build-to-rent investment, but was clear an affordable housing component was crucial.

She said it was important the not-for-profit community housing sector had a partnership role in the build-to-rent industry, particularly to ensure affordable housing was available in “perpetuity” rather than run the risk of government concessions “slipping through” to the private sector.

Consultation on the government’s proposed incentive is currently underway, though a spokesman for Mr Dick saying the view was that developers “should provide a minimum affordable housing component of at least 10 per cent in exchange for the tax concession”.

“(This is) consistent with the successful approach used in the build-to-rent pilots underway,” he said.

The state government’s online information on this pilot noted “a targeted rental subsidy will be provided to deliver affordable rental housing within the Build-to-Rent developments”.

The definition of “affordable” housing will also be worked on through the consultation process.

QShelter’s preferred definition is what’s known as the “30/40 housing rule”, where rent is no more than 30 per cent of the pay packet of Australians earning 40 per cent or less of the national average wage.