Growing the Build to Rent sector could play a critical role in rescuing Victoria’s falling apartment market.
The Property Council of Australia is urging the Victorian Government to bring forward initiatives to support Build to Rent as part of a recovery package for Victoria’s property sector.
Build to rent projects are residential developments where all apartments are owned by the developer, and leased out to tenants professionally, often featuring additional benefits for tenants such as gyms or shared rooftop gardens.
ABS lending data released today shows apartment lending in Victoria has dropped by 14.1 per cent since August of last year, while lending in NSW has increased by 1.5 per cent over the same period.
The NSW Government announced a Build to Rent package in July this year.
The Property Council has long been advocating for appropriate tax settings, combined with planning interventions, to support the growth of Build to Rent in Victoria.
A Victorian Build to Rent package could create a healthy apartment supply pipeline, create 49,950 jobs, and contribute $3.87 billion a year to the State’s economy.
Property Council Executive Director, Cressida Wall, warned that dwindling apartment market investment could have significant long-term impacts on affordability in Victoria.
“Build to Rent can play an important role in boosting housing supply and choice – especially with at a time when lending and private sector investment in the sector is constrained,” she said.
“Today’s lending figures show just how hard the Victorian property industry has been hit by COVID-19.
“The Government needs to pull every economic lever at its disposal to help the industry recover – and encouraging Build to Rent is a sensible stimulus measure that will drive apartment supply, jobs and support economic recovery,” said Ms Wall.
“A plan to support Build to Rent in Victoria will encourage investment in the sector and help secure a long-term residential supply pipeline.”