A Queensland government proposal to limit rent increases to once a year does not go far enough to address the serious housing stress on the state, tenants and social organisations say.
Landlords will only be able to increase rents once a year, rather than every six months, under reforms introduced to the state parliament on Tuesday.
On Tuesday the premier, Annastacia Palaszczuk, said the measure will “give people who are renting a fairer go”, but appeared to back away from earlier comments that the government was “very seriously considering” capping the amount rents can increase each time.
The government also announced a suite of tax concessions for property developers, including slashing their land tax in half for 20 years, if one in 10 units in their development were to be for “affordable” housing.
Other available tax concessions include a full exemption on the 2% foreign investor land tax surcharge for two decades.
The government will also provide an additional $28m to continue the Immediate Housing Response Package for another year.
The chief executive of the Queensland Council of Social Service, Aimee McVeigh, welcomed the proposal to limit increases to once a year but said a rent cap was needed to stop “potential price-gouging.”
“Given the extraordinary circumstances Queenslanders are finding themselves in, we really need to tie rent increases to CPI increases, similar to what is already happening in the ACT,” she said.
“Unaffordable rents and the lack of housing supply is pushing families into homelessness, and we need the government to step in under these extreme circumstances and go further with rental reforms.”
Queensland’s Make Renting Fair campaign has been calling on the government to use the consumer price index (CPI) as the benchmark to limit rent increases.
But the proposal was met with fury by developers, the real estate industry and the Courier Mail, which dubbed the measure a “dunce’s cap”.
The state’s opposition also last week organised a press conference with the chief executive of the Real Estate Institute of Queensland, Antonia Mercorella, who lashed the move as “a thought bubble”.
But the chief executive of Tenants Queensland, Penny Carr, said the rent cap put forward by the campaign was “moderate” and would “maintain returns for landlords … whilst providing stability to tenants”.
Carr said 195 people had sought advice from Tenants Queensland about rent increases between January and March. The average rent increase was $100 – the largest being $705 a week – with only 15 people having rent hikes below the rate of the CPI.
“We’re pleased the premier is focused on this issue and support her proposal to limit rent increase frequency to once per year. However that alone will not stop the price gouging we’re seeing in parts of the market,” Carr said.
The executive director at Q Shelter, Fiona Caniglia, said she feared the outcome for tenants if no limit was placed on the amount that rent can increase.
“While the increasing costs of mortgages are impacting property investors, tenants are being pushed to the brink of homelessness by the scale of rent increases that can occur,” Caniglia said.
Caniglia said “while property investors have enjoyed capital gains, tenants have not been able to stretch their incomes”.
“Q Shelter has heard from property investors who have chosen not to increase rents and are pushing back at proposals to charge excessive increases,” Caniglia said.
“While this is commendable, it doesn’t replace the value of having certainty through legislation.”
In parliament on Tuesday the Greens MP for South Brisbane, Amy MacMahon, made a failed attempt to suspend standing orders to bring on urgent debate of her rent freeze bill – which is separate from the rent cap others are calling for.
MacMahon separately described the government’s announcement as a “slap in the face to thousands of Queensland renters”.
“Renters have no assets and are among the lowest-income earners – the government needs to protect working people and families, not the incomes of investors,” MacMahon told Guardian Australia.
“For a renter on a 12-month lease facing a $350 per week rent hike, this fake rent cap means absolutely nothing.”
