Queensland Premier Annastacia Palaszczuk has announced the State Government will “act immediately” to limit rent rises to one per year.
Ms Palaszczuk, who is currently at a housing crisis roundtable, said limiting rent increases was about giving Queensland renters a “fairer go”.
She said the move was designed to balance the rights and interests of Queensland tenants and property owners to sustain a healthy rental supply.
But the decision has immediately drawn the ire of property and investor bodies who fear it will force more landlords out of property investment and reduce rental supply.
“There are more than a million Queenslanders who rent their homes and every single one of them must be given a fair go,” Ms Palaszczuk said.
“A fair go to pay rent they can afford and not be penalised for the cost of living situation all Australians find themselves in today.
“Our government will act immediately to place a limit on the number of rent increases that can be imposed on tenants each year.
“We will limit annual rent increases to just one.
“The great majority of landlords do the right thing and look after their tenants – but for those who do not, this is a wake up call.
“We must act and will act to deliver reforms that balance the rights and interests of Queenslanders who rent and property owners to sustain healthy rental supply.”
The Premier first floated the idea of a rental cap last week, but the changes are not expected to include a limit on how much rents can be raised.
When the idea was first mooted the Real Estate Institute of Queensland CEO Antonia Mercorella said the State Government meddling with the rental market would act as a red flag to property investors and would drive them away.
“In the middle of a housing crisis caused by lack of housing supply, it’s beyond belief that the Government is now proposing a measure which innately discourages further supply,” she said.
“No one denies that there is an immense amount of pressure for the most vulnerable in our community, but rent control or freezes are not the answer.
“It’s not only the property industry calling this out, several leading economists in Australia agree that rent control is not the solution.”
The Property Investors Council of Australia Chair Ben Kingsley said the plan would be a bridge too far for many Queensland investors.
“Those tenancy groups, and now the State Government, who are lobbying for a rent cap are claiming some sort of market failure is the reason why, well, we want to know from them, how is reducing investor demand and rental housing supply going to improve the situation for Queenslanders?” Mr Kingsley said.
“New arrivals to Queensland try before they buy, meaning they rent, but if there are no rental properties, because no investors can trust the government to allow a free market to operate, these new arrivals won’t have anywhere to live, business won’t be able to employ staff, and the Queensland economy and its citizens will ultimately be the biggest losers.”
Property Investment Professionals of Australia Chair Nicola McDougall said it appeared that the Queensland Government had not learnt from its failed land tax regime.
“It is too much to ask that our elected officials have a rudimentary understanding of economics? It hasn’t even been six months since the ridiculous interstate Queensland land tax was axed, and now the Qld Premier is seriously considering rent caps,” Ms McDougall said.
“This knee-jerk policy position was clearly in response to the QCOSS report that showed homelessness in Queensland rose by 22 per cent in the four years to 2021- 22 compared with just eight per cent across Australia.
“PIPA research last year also showed 160,000 rental properties had been stripped from Queensland markets in just two years – with even more investors set to sell if rental caps are introduced.
“Without any meaningful solutions by the state government to increase rental supply in the Sunshine State – and therefore stabilise rents – the Premier will likely go down in history as the leader who forced more Queenslanders into homelessness than ever before.”