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Rental affordability scheme: good in theory but not in practice?

Staff Reporter 4 minute read

The federal government’s recently announced initiatives to tackle housing affordability have been met with scepticism by the mortgage industry.

Almost 90 per cent of respondents to the latest Mortgage Business straw poll indicated that the government’s recently announced National Rental Affordability Scheme would do little to combat housing affordability effectively.

While president of the Real Estate Institute of Australia (REIA) Noel Dyett argues that the scheme is a step in the right direction, he has reservations about how the scheme will be carried out.

“How will the reduced rents be calculated and how will changes in rental prices be addressed?,” Mr Dyett asked.

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“I think investors may want answers to these questions before they will be convinced to participate in the scheme.”

According to Mr Dyett the government needs to take immediate action to reduce the pressure on the housing market.

Doubling the first home buyers grant to reflect the increase in house prices, as well as taking control of development costs and processes to stimulate building activity, are areas Mr Dyett believes would have an impact.

“Essentially we are an increasing population and we are not providing enough housing to meet that growing population,” he said.

“The government needs to take direct action because without the right numbers [of available housing] the costs of renting and housing will continue to rise.”

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Published: 12-03-08

Rental affordability scheme: good in theory but not in practice?
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