In its budget submission, the REIV has outlined five specific tax and regulatory policy recommendations designed to attract property investment and create a more sustainable rental market.
The proposals aim to support the government’s ambitious target of building 800,000 new homes by 2034.
Easing stamp duty and land tax obligations for rental providers tops the list of priorities.
The REIV is particularly concerned about the growing trend of investors withdrawing from the long-term rental market, with data showing a 3.55 percent decline in rental bonds between March and September 2024, representing approximately 24,000 fewer rental properties.
The submission recommends progressive land tax concessions to encourage extended long-term leases of over five years, similar to models seen in international rental markets.
These longer leases would provide greater security for both renters and property owners.
REIV CEO Kelly Ryan said it was important to create a more balanced regulatory environment to stimulate investment in the rental sector.
“If the Victorian Government is to succeed in fulfilling its critical mandate of improving the state’s housing supply, better enabling property sector investment is paramount,” Ms Ryan said.
“Key to that, and at the heart of our submission, is the need to ensure a more balanced tax and regulatory regime that includes adequate incentives for rental providers.”
The REIV has also noted a concerning trend of rental providers withdrawing properties from the long-term market due to rising costs and complex regulatory obligations.
This reduction in supply is contributing to escalating rental costs across Victoria.
The submission suggests redistributing property management responsibilities between renters and rental providers as another measure to encourage longer-term leases, which could help stabilise the rental market.
The REIV plans to continue engaging with the Victorian Government to advocate for policies that encourage residential real estate investment, noting that many rental providers are everyday Victorians rather than large corporations.
The organisation’s recommendations come at a critical time for Victoria’s housing market, with affordability and availability issues affecting communities across the state.
By addressing tax settings and regulatory burdens, the REIV believes the government can create conditions that will help achieve its housing targets.
“A growing issue our members are seeing play out across the sector is rising costs and complex regulatory obligations causing rental providers to withdraw their properties from the long-term rental market,” Ms Ryan said.
“This development, which is serving to reduce supply and drive-up rental costs, is reflected in a 3.55 per cent (or 24,000) decline in the number of rental bonds held by the Residential Tenancies Bond Authority between the March and September 2024 quarters.”
