A rental crisis in South Australia is looming with some rental increases of up to 20 per cent likely with vacancy rates approaching zero.
Shadow Treasurer Rob Lucas said today that evidence presented by the Real Estate Institute (REI) to the Legislative Select Committee on Property Taxes painted a bleak picture of the rental market in South Australia.
“The REI indicated today that whilst the vacancy rate in November was 0.5 per cent, it was likely that January figures would show an even tighter rental market. The REI also indicated the vacancy rental rate in South Australia was lower than for any other state,” Mr. Lucas said.
“The REI also gave examples of significant rent increases already occurring. For example, a three bedroom maisonette in Elizabeth had risen from $125 per week to $150 per week in just six months. This jump of 20 per cent in rent is already hurting low income earners.
“The REI indicated the major cause for the problems in the rental market was the high level of taxes and charges, and especially land tax in South Australia.
Mr. Lucas said that investment returns for many investors are as low as two per cent, which has meant that many investors are withdrawing from the rental property market and investing their money elsewhere.
“The Land Tax Reform Association and the Liberal Party have been warning the Rann Government now for three years of the impact their high land tax rates would have on renters and others who could least afford it,” Mr. Lucas said.
“Sadly, the evidence of the REI today has confirmed the accuracy of those warnings.
“Mr. Rann and Mr. Foley soon have to wake up and realise people cannot afford 20 per cent rent increases and provide land and property tax relief urgently to help tackle this rental crisis.”