Queensland’s property industry is sounding the alarm over potential rent controls, warning they could further reduce rental availability.
Leading industry bodies, including the Property Council of Australia Queensland, Real Estate Institute of Queensland (REIQ), and Urban Development Institute of Australia Queensland (UDIA), have expressed concern that the government’s failure to rule out rent controls is undermining investor confidence.
Property Council’s Queensland Executive Director Jess Caire said rental caps and further rent controls would be detrimental to housing affordability and deter new housing supply.
“Any government intervention in the setting of private rents-whether through rent caps, freezes, or controls, whatever name you want to give it-has the same chilling effect on investor confidence,” Ms Caire said.
REIQ CEO Antonia Mercorella echoed these concerns and said that the prospect of rent caps could be “catastrophic” for the rental market.
“If rent caps – or another form of rent control – were to become a reality, not only would it signal broken promises and a major backflip from the Miles Government, but it would be the last straw for many investors who had endured a legislative onslaught over the last four years,” Ms Mercorella said.
UDIA Queensland CEO Kirsty Chessher-Brown said there was a need for focus on boosting housing supply rather than implementing rent controls.
“Our research shows the shortage of homes will continue to worsen in Queensland, as there is already no way our industry can meet government’s new homes targets,” Ms Chessher-Brown said.
The industry bodies argue that rent controls have proven ineffective in other markets.
They point to the Australian Capital Territory, where rents have increased by 14 per cent since the introduction of rent cap laws in 2019, significantly higher than the national average of 4.6 per cent.
Ms Caire said there was a lot of international evidence against rent controls, including a 2018 Brookings Institute study which found that rent control appears to help affordability in the short run for current tenants, but in the long run decreases affordability, fuels gentrification, and creates negative externalities on the surrounding neighbourhood.
The property industry is calling on the Queensland Government to provide clarity on its position regarding rent controls to restore investor confidence in the market.
“With uncertainty hitting overdrive that the Government is once again considering rent capping – despite previously ruling it out – every Queensland investor is googling ‘How to sell your investment property,’” Ms Caire said.
