The Property Council of Australia has highlighted the pivotal role of the government’s draft build-to-rent (BTR) legislation in achieving the ambitious goal of adding 1.2 million new homes by 2029.
Insights from EY, commissioned by the Property Council, suggested that a 15% managed investment trust (MIT) withholding rate could generate 150,000 apartments by 2033 without necessitating an affordable housing mandate.
Further studies by EY indicated that reducing the MIT withholding tax rate to 10% for BTR projects with affordable housing could fast-track the creation of 10,000 affordable homes over a decade, in addition to the projected 150,000 rental units.
Matthew Kandelaars (pictured above), the Property Council’s group executive for policy and advocacy, said the draft legislation's technical details are crucial to the success of new home deliveries and achieving the national housing target.
“The enormous potential of a 150,000-apartment pipeline hangs in the balance, and there's only one chance to get this legislation right,” Kandelaars said.
Kandelaars underscored the importance of affordable housing in the nation’s housing strategy.
“Affordable housing is a crucial part of a broader housing mix,” Kandelaars said. “We proposed an additional model that would... deliver a further 10,000 affordable rental apartments at no extra cost to the taxpayer.”
The proposed reduction in the MIT withholding rate from 30% to 15% aims to equate BTR projects with other asset classes, fostering an environment conducive to the development of quality, secure housing.
“Even with the best of intentions, drafting missteps could risk the delivery of high-amenity, securely tenured homes backed by the institutional capital that's critical to deliver the homes our nation desperately needs,” Kandelaars said.
“The Property Council is reviewing the details of the legislation and will work with the government to ensure it delivers on its potential to create 150,000 rental homes and an additional 10,000 affordable rental homes,” Kandelaars said.
The Property Council is examining the legislation’s specifics and plans to collaborate with the government to realize the potential of creating 150,000 rental and an additional 10,000 affordable homes.
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