Mum and Dad property investors are this year being slugged with greatly increased land tax by the Allan Labor Government, which is having a dire impact on the already stressed housing rental market.
Gippsland East Nationals MP, Tim Bull, said the new big tax bill will directly result in less rental properties in the marketplace.
“In this period of rental and housing crisis, Labor is driving middle income investors out of the sector with its massive tax increases.
“Properties are being sold and rents driven up as landlords invest elsewhere. The homes are not being sold to those who are renting or to the homeless, as they cannot afford the purchase prices, so it just makes it harder for families.
“A strong private rental sector is a key component of dealing with housing availability, but this tax is making landlords invest interstate, in the stock market, bonds or another option. Alternatively, if they stay in the market, they pass this additional cost on to renters who can’t afford to pay.
“The Allan Labor Government also seems to hold the view that those who own a second home are wealthy. This is not accurate.
“The top 40 occupations of people who own rentals include workers in childcare, the disability sector, aged care, motor mechanics, truck drivers, receptionists, sales assistants, school teachers, nurses and police officers. They have simply chosen to invest in property rather than another option.
“The government’s cash grab includes decreasing the land tax threshold from $300,000 down to $50,000 and it is also whacking owners of properties valued between $300,000 and $600,000 with an annual tax bill that starts at $1,350. Last year the same landlords were charged around $375,” Mr Bull said.
“Talk to any real estate agent and they will tell you landlords are seriously considering their future and when they leave – as they are – it further increases the gap between rental demand and supply.
“Wouldn’t it make more sense to say to Mum and Dad investment property owners – if you commit to the rental market for 5-10 years, you will be exempted from these charges? Incentivise them, not punish them,” said Mr Bull.
To provide an example of the impact of things like the land tax money grab, it was recently reported the CEO of Stockdale and Lego, a major realtor said, “when the land tax change was announced, all our offices across Victoria received calls from landlords saying they wanted out”.
“That article also quoted one landlord selling up and moving her property investment to Queensland, and another selling up and investing in the stock market. It is becoming more common.
“Add into the mix, the Federal Government has just announced the highest number of foreign students will come into Australia in a decade, with over half a million visas granted.
“A report by the Institute of Public Affairs found international students took up 70 per cent of new housing units in the last financial year and the flood of students coming will further increase pressure on the housing market.
“First National Real Estate chief executive, Ray Ellis, said he feared such a move would result in a 30 per cent reduction in rental supply – ‘at a minimum’.
“Then throw in on top of this that we have less public housing in East Gippsland than we had seven years ago and you can see why the housing crisis is hitting so hard,” said Mr Bull.
“In 2017 we had 933 public housing homes in East Gippsland, that is down to 931. Labor spouts its Big Housing Build and the new homes, but what they don’t tell you is that in many areas they are selling off old stock at a quicker rate.
“The Housing Minister is our own local Labor Upper House MP, Harriet Shing, and she needs to act.
“The housing market is tough, but Labor’s policies are making the housing market even tougher as it tries to service the massive debt it has created, which presently includes an interest bill of $15 million per day.
“Ms Shing could start by halting the war on our middle-income landlords and providing a framework that encourages people into property investment rather than push them out.
“This is the outcome of not being able to manage projects or money.”

Monday, 26 February 2024