This article is from the Australian Property Journal archive
LANDLORDS in Western Australia could be given $5,000 to bring their empty houses onto the long-term rental market.
The Cook government is putting $5 million in this budget towards the Vacant Property Rental Incentive Scheme that offer payments to owners of up to 1,000 vacant properties who are willing to provide a minimum 12-month lease agreement to new long-term tenants.
Payments will be made to the property owner once the dwelling has been leased and occupied.
For owners to qualify for the payment, the vacant property must meet a number of conditions, including that it has been vacant for at least six months, is a single self-contained property with its own bathroom, kitchen and toilet – spare rooms or ancillary buildings, like granny flats, will not be eligible – and has not been used to receive a payment under the STRA Incentive Scheme.
The property must be tenanted for the full period of the minimum 12-month lease. If the lease is broken during that time, the property must be re-let on the long-term market within six weeks for the owner to avoid having to pay the grant money back.
A lack of supply has not only made finding a house more difficult for renters – the REIWA has the vacancy rate at just 0.4% – but it has also made it much more expensive. Perth led the nation in rental growth in the year to April, with a huge 13.6% rise, now sitting at $669 per week, according to CoreLogic data.
Treasurer Rita Saffioti said the initiative has the potential to bring up to 1,000 properties back onto the rental market that would otherwise be sitting vacant and unused,
Cath Hart, CEO of the REIWA, said, “We appreciate that the government hasn’t taken a punitive approach to this issue as not all vacant properties can be transitioned to the long-term rental market, for example they may be undergoing redevelopment or renovation, so punitive measures such taxes or vacancy fees would be unfair.”
The newly-announced initiative follows implementation of the government’s Short-Term Rental Accommodation (STRA) Incentive Scheme, which has prompted 150 owners to take up the $10,000 incentive payments and switch their properties from Airbnb and short stay accommodation to the long-term rental market.
The government has also extended the STRA Incentive Scheme, which had applications due to close today, but will now remain open for a further six months, until 8th November, to allow more time for owners to make the switch.
“Housing supply is the greatest challenge facing the market at the moment, and in assessing housing policy, the big question is whether it will increase the number of homes that can be built, bought or rented,” Ms Hart said.
Planning and Housing Minister John Carey said the government “continues to think outside the box and look at a range of measures, not just to provide new housing, but to better utilise existing stock to boost housing supply across the continuum”.
Western Australia Premier Roger Cook said, “Western Australia’s nation-leading economy and attractive lifestyle are driving significant demand for housing, so we are leaving no stone unturned in our work to boost supply of homes,”
“Modelled on our successful Short-Term Rental Accommodation Incentive Scheme, this latest offer is designed to address the issue of much-needed properties sitting vacant and make them available for rent.”
