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REIQ: State Budget misses the mark

The Real Estate Institute of Queensland has hit out at the State Government’s 2022-23 Budget, saying it is disappointed at the lack of action on housing affordability and accessibility.

REIQ Chief Executive Officer Antonia Mercorella said the budget had missed valuable opportunities to implement key reforms, including stamp duty, which had again been ignored.

She said while other jurisdictions, such as NSW, had moved on stamp duty, the Queensland Government had not progressed to phasing out the “volatile” tax.

“Stamp duty significantly hinders home ownership, discourages housing turnover, and restricts mobility, and its abolishment would open doors in Queensland for many,” Ms Mercorella said.

“That’s why we’ve long advocated for a 10-year phase-out program and eventual abolishment of stamp duty by first introducing stamp duty exemptions allowing older Queenslanders to ‘rightsize’ into more suitable homes, and ultimately, replacing stamp duty with a broad-based land tax.

“The Henry Tax Review, delivered over a decade ago, identified it as a ‘bad tax’ and yet it remains with us today with not even a whiff of a plan for stamp duty reform on the horizon.” 

On Monday, the Queensland Government announced the Housing Investment Fund would deliver up to 1200 new social and affordable homes in a partnership between the Brisbane Housing Company and Queensland Investment Corporation.

Stage 1 of the program will deliver 600 homes through seven different projects, with the Palaszczuk Government announcing the first two, at Ethel St in Chermside and Sutton St in Redcliffe, last month.

Treasurer and Minister for Trade and Investment Cameron Dick said the projects were part of the government’s concentrated investment in social and affordable housing, the largest in the state’s history. 

“Every Queenslander deserves a safe home to live in and a secure roof over their head,” Mr Dick said.

“There’s never been a more important time to plan and deliver the infrastructure that Queenslanders need, including social and affordable housing. 

“When applications opened for the $1 billion Housing Investment Fund, we told the market we were seeking proposals which identified new solutions to deliver housing for vulnerable Queenslanders.”

Ms Mercorella said the scheme had already been announced last year and the REIQ was disappointed the Budget didn’t contain any real new action on social housing.

“While we welcomed the $1 billion Housing Investment Fund generating $40 million a year for new housing supply and $1.9 billion for the Housing and Homelessness Action Plan 2021-25 last year, we’re only seeing the same funding re-announced, with demand outpacing the output,” she said.

“The housing crisis has seen us join state-wide calls from councils, community services and industry bodies for an increase in social housing funding. That sadly hasn’t materialised in this budget.”

But Mr Dick said the government was taking significant action to help Queenslanders facing housing challenges.

“The 2022-23 State Budget will allocate $200 million to build the essential infrastructure needed to unlock housing supply, funding the delivery of water and sewer infrastructure to create more residential lots in new communities,” he said.

“This supports the ongoing delivery of our $1.9 billion Queensland Housing and Homelessness Action Plan 2021-2025 announced last year, which will result in the construction of 7400 new dwellings across our state.”

Premier Annastacia Palaszczuk said the Budget also included close to $1.7 billion for the Queensland Reconstruction Authority to aid recovery from the floods earlier this year, as well as other disasters that have occurred since 2019.

She said the total recovery cost was expected to be more than $3 billion after 66 of the state’s 77 local government areas were activated for assistance over nine natural disasters in the 2021-22 season.

“This includes the nation-leading $741 million Resilient Homes Fund that provides options for eligible flood-affected Queenslanders to raise, retrofit and take part in a voluntary buy back, which will significantly ramp up delivery in 2022-23,” Ms Palaszczuk said.

Ms Mercorella said the Budget had also missed opportunities to assist the construction sector and renters.

“Despite a construction sector in crisis, and the government itself conceding that builders and building supplies are rare as hens’ teeth, the First Home Owners’ Grant continues to overlook established housing, remaining restricted to new construction,” Ms Mercorella said.

“With rising construction costs and financial entry barriers making building or purchasing a brand-new home simply unfeasible for many first home buyers, surely, it’s time to extend this initiative to established housing options.

“In addition, given that we are in the throes of a rental crisis, support measures should be going further to help more renters transition into home ownership by providing some upfront financial assistance and opening up access and choice to include established housing.”

Ms Mercorella added that in order to help take some of the strain of housing Queenslanders off private ‘mum and dad’ investors, it was time to make the build-to-rent model more appealing, specifically with vulnerable groups in mind.

“The REIQ would welcome innovative ways to deliver increased housing supply, such as amending taxation rules to stimulate build-to-rent developments, like we’ve seen with the land tax concession announced in Western Australia,” she said.

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Kylie Dulhunty

Kylie Dulhunty is the Editor at Elite Agent.