26 Nov 2019
For nearly two decades, Australian cities have been consistently ranked among the world’s most liveable. But the dial is shifting. With a large proportion of Australia’s rapidly growing population renting, the new Australian dream is fuelled by an increasing need for accommodation close to work, offering high quality amenity and security of tenure.  

In response, a new approach is required – one that addresses this emerging demand and in doing so retains our enviable liveability and economic productivity. The Build-to-rent (BTR) sector, may be the quickest and most productive solution to increase choice and capacity at scale to address housing supply and affordability.

Population growth characterises a significant challenge. Over the next decade (2019-2029), ABS dwelling projections reveal:

  • 1.6m homes are required to be delivered
  • 500,000 of that is additional rental properties
  • 200,000+ rental households will be in rental stress

Incentivising BTR could bring forward the delivery of a pipeline of approved projects resulting in three years of housing supply in the inner city – if released for development. For Australian cities to thrive, an increased supply of high-quality rental accommodation is needed. These will house global talent for multi-national companies and promote local labour mobility while meeting the demand for greater choice of housing across a variety of price points in our growing cities.

While BTR is gaining traction, it’s still trying to prove its viability. Government policy does not currently support its emergence in any Australian jurisdiction. Adjusting tax and planning policies will have the greatest impact on growing the BTR industry and based on a UK case study, the provision of land tax concessions was the lever that kick started the rapid and successful growth of the sector.

While different groups are pitching their view of what BTR is, should or could be at different points of the market spectrum, what is agreed is that BTR represents a fast route to increase housing capacity, which flows through to affordability and assisting to prevent a downwards trend through the housing spectrum.

BTR is a positive catalyst that can support gains against a housing shortage, cater to the demands of modern consumers, provide an attractive long-term investment and restore the faith in our construction industry.

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