Chapter:
15 - Housing
Mover:
Seconder:
 
 
Source:
EEIRT Policy Committee
My Private Notes


Preamble
The ACT Government has led the way nationally with CPI-linked measures for rental increases introduced in recent years. In parallel, the ABS has made improvements to rental data, drawing a 30% national sample from property manager reports, and the ATO has made accurate reporting of rental property income and expenses a priority in recent compliance initiatives.

The ACT’s rent increase regulations so far have not involved reporting, instead relying on escalation by a tenant to ACAT, which for some will be prohibitively costly and burdensome. For some of the period since controls were introduced, ABS data has shown the ACT’s rent increases to exceed national averages, with researchers noting a CPI-linked index can be a circular reference, where ‘higher rents justify higher rents’.

The effects of this are worst for vulnerable groups, including older women who are the fastest-growing group in homelessness, and for those experiencing domestic violence, predominantly women.

Reporting of rent increases, including in-lease increases, involves a landlord or property manager only copying the ACT Government on a new lease or variation, which is a minimal ask, and the minimum expected for a tenant to claim the Commonwealth Rent Assistance, or landlords to report to the ATO.

With the current CPI-linked increases, there is a risk that landlords doing the minimum (or refusing to) can increase rent as much as the most diligent and value-adding, who are limited to the same level. 

This lessens the incentive to invest in new stock, to add value to properties, or to generally promote competition among landlords. As well as reporting of rent increases, brief reasons for an increase may be a reasonable ask to ensure a competitive, dynamic and productive rental market.
General Resolution

Supporting rental reforms through data and industry engagement

​ACT Labor calls on the Government to consider approaches for improved data on rent prices and especially rent increases, including in-lease increases. 
In support of this process would be engagement of industry and community groups, including tenants' representatives in the ACT and interstate, and groups engaged with housing security for diverse groups including gender perspective, and noting the recent collaborative success of property managers with the ABS on CPI data.

The Government may leverage the benefit of rental data to:

- Compliant and efficient operation of rental reforms, for tenants, landlords and the tribunal system;

- Setting fair rents for social and public housing using the most complete and current data;

- Design incentives for productivity and competition in the rental market;

- Design and implement the best policy for at-risk groups, including older women;

- Improve input to emerging data sharing arrangements with the Commonwealth;

- Through data sharing, lessen burden on tenants and landlords, and supporting digital government;

This reform would reflect a nation-leading commitment to rental reforms and evidence-based policy, fit for the digital systems of 2024. Copying the Government lease variations as well as existing reports of new leases is a change with trivial administrative burden but with strong economic and social benefits. 

The total data set for Canberra rents, and a tracker for increases above the cap, can be operated on a single spreadsheets bringing efficiencies and insight both to the ACT Government and federal colleagues, including data sharing initiatives progressing through the Commonwealth-State Data and Digital Ministers' Meetings.