Queensland rental crisis: caps ‘a red flag’ to property investors

Queensland will consider repli­cating the ACT’s rental cap scheme and tie increases to inflation as part of a bid to tackle the state’s housing crisis.

Queensland will consider repli­cating the ACT’ rental cap scheme in a bid to tackle the state’s rental crisis. Picture: Sophie Foster

Queensland will consider repli­cating the Australian Capital Territory’s rental cap scheme and tie increases to inflation as part of a bid to tackle the state’s housing crisis.

Deputy Premier Steven Miles said everything will be on the table when state government meets with industry and advocacy groups at a housing roundtable next week.

“We could look, for example, at limiting the number of times per year rents could go up,” he said. “Or we could look, as other jurisdictions have, at limiting the amount they can go up by, for example, tying them to CPI.”

The ACT is the only Australian jurisdiction with rental caps limited to no more than 10 per cent above the consumer price index.

Mr Miles acknowledged that investors needed to “see a return on investment” in an environment where property prices and interest rates had increased “but whether there should be limits placed on that increase, or whether there should be limits on how often and how they can be increased, they are all the sorts of things we want to discuss”.

Real Estate Institute of Queensland chief Antonia Mercorella said uncertainty around how much the government would meddle in the market would act as a blazing red flag to property investors. “This government seems intent on shattering the confidence of investors,” she said.

“In the middle of a housing ­crisis caused by a lack of housing supply, it’s beyond belief that the government is now proposing a measure which innately discour­ages further supply.”

Tenants Queensland chief Penny Carr welcomed discussion on rental caps, saying people had been living hand to mouth across the state.

Premier Annastacia Palas­zczuk has faced backlash from economists and industry bodies after announcing on Monday that her government was “seriously considering” putting a cap on ­rapidly rising rental costs throughout the state. “This is a big issue for families,” she said. “They are constantly being faced with huge increases in rent.”

Her comments followed a report by the Queensland Council of Social Service, which revealed the rate of homelessness in the state had increased by 22 per cent since 2017 compared with 8 per cent nationally.

Deputy Premier Steven Miles said everything will be on the table when state government meets with industry and advocacy groups over the rental crisis. Picture: Dan Peled / NCA NewsWire

Median rents rose 80 per cent in Gladstone on Queensland’s central coast, 51 per cent in Noosa and 33 per cent on the Gold Coast in the past five years.

QCOSS chief Aimee McVeigh said state and commonwealth governments had to be “more ambitious” with housing policy.

“The deep-rooted problems revealed by the report call for a long, hard look at our underperforming housing system, and demand fundamental structural reforms to match,” Ms McVeigh said.

LNP Treasury spokesman David Janetzki said rent controls did not address the cause of the problem, an undersupply of housing stock. “The best way we increase supply is through stable taxation and regulatory environments. That is where we need the government to focus,” he said.

A Labor-dominated parliamentary committee examining proposed rental freeze laws put forward by the Greens last year found rental controls were “not ­effective in improving housing ­affordability for renters and can lead to distortions in the market”.