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PropertyPoint: Spring selling, Terminal rates, Regulation and What's up with Queensland

Ben Kingsley from Empower Wealth and Pete Wargent from BuyersBuyers join Evan Lucas to dive into all things property in this month's PropertyPoint
By · 6 Sep 2022
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6 Sep 2022 · 7 min read
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EL: Ben Kingsley, welcome to Property Point.  It’s an interesting day to be coming to you, we’ve just seen the hedonic values from CoreLogic come out for the month of August, it’s another story around the declining movement in the housing market here in Australia.  The other part of what we’re about to go through is it is September and it is traditionally the spring silly season.  Can you take us through what you currently see is translating in the Australian housing market and how you think it will translate over the next couple of months to a year?  

Yeah, it’s the $64 million dollar question, isn’t it, Evan, in regards to where we are?  Certainly, we’re probably seeing continued downward pressure on the overall market and that’s why it is interesting, as you and I know, is the spring selling season is coming and that usually means more stock that comes on the market.  So, obviously we’re measuring two really important things and then we’ll talk about interest rates.  But we’re measuring sentiment and then we’re also measuring intent in regards to what’s actually happening from a supply side.  So, we come out through the end of winter, into an area where there’s still a fair bit of supply in the system.   

But there’s not that buyer appetite, so we’re seeing that sort of supply levels holding and now with spring coming around the corner, we do anticipate to see more supply coming in but that is the difficult question here in terms of what’s actually happening with the seller, what are they thinking about?  Because, ultimately, most sellers have to rebuy and so if they’re not thinking they’re going to get a top dollar, what they may be thinking about is basically just putting it off.  So we may not see the same traditional levels of supply coming into the market in, say, Melbourne and Sydney, by example, because they’ve obviously got to rebuy and in some cases they’re upgrading or downgrading.   

So, we’re still basically seeing sellers come to the realisation of where the market is at, because we know anecdotally in the buying that we’re doing on a week to week basis, that some sellers still believe their properties are worth more and if they’re not forced sellers, they may hold out for that price point or basically withdraw their property from sale.  We’re seeing obviously a lot of that through the auctions as well, where if they don’t feel like they can get the price that they want, well ultimately that means that their extra goals in terms of what they’re trying to achieve may not play out, so they withdraw from auction and they may, again, withdraw their property from sale completely.   

So it is quite a fascinating market from the supply-side.  The sentiment-side is also one of which we’ve been watching closely in regards to the two sort of consumer sentiment surveys that we see on a regular basis, Westpacs and ANZs.  We are definitely seeing that during this tightening cycle of the cash rate, that sentiment, time to buy property and those types of things have taken a real hit.  But we are starting to see them stabilise now.  So, whilst they were in freefall a couple of months ago, they’re now starting to find a bottom and I suspect people are starting to get more comfortable with the idea that they’re going to have to pay more in regards to mortgages and the like, which swings us into the conversation around interest rates and where we go from there and that really is the most difficult question given you’re seeing most economists are predicting anything between sort of 2.5 per cent, end of this year, to 3.5 per cent as a cash rate.  

EL: On that, because the next question that comes, is what you guys do at Empower Wealth, is around property investment and property sizes.  Have you started to really see that investment market really fall away, is that starting to also stabilise, like you’re seeing with the overall market?  

BK: Yeah, we did start to see a little bit of – and I don’t want to pre-empt and sort of say, here’s a typical – you’re asking a barber whether I need a haircut.  But, we did see some improvements over the last couple of weeks with auction clearance rates and again, I think with obviously a cash rate decision imminent and probably another 50 basis points, that’ll take us to the 2.35.  I still think there is an underlying uncertainty and I still think people are being apprehensive.  In terms of our business itself, yeah, look, we’ve got a lot of long-term investors who are seeing opportunity so that has given us a good baseline.   

But there’s certainly the new people that we’re talking to, there’s that natural apprehension and uncertainty because we don’t know where the market’s going and what we know through human and economic behaviour is that everyone wants the FOMO and they’ll jump in when everyone else is jumping in.  But the astute investor is going to see opportunity over the next six to 12 months and they’re the sort of repeat clients that we’re working with at the moment and those new customers who are coming in who have basically been patient, are now starting to think about whether they want to move.   

Most investors that we work with are long-term investors, we’re talking about building models over 30, 40, 50-year periods.  If I can quote the great Benjamin Graham, he talks about the share market being a voting machine in the short-term, popular and unpopular sort of themes that run through it.  But over the long-term, it’s a weighing machine and if you think about property over that 20 to 50-year timeframe, what you need to look at, is in the short-term it’s very much a supply/demand story.  But over that long-term, what you’re looking at is property prices and land values are a product of gross state production and then you’re looking at those large employment centres and those knowledge centres such as Sydney and Melbourne, Brisbane and all of those capitals.  

When you’re looking 20, 30, 40, 50 years and beyond, you’re looking at their potential to compete and win in the market for knowledge and what sort of industries of the future are going to be there and the wealth and the accumulation of wealth and the reinvestment of wealth in those particular capital cities.  When you start to think of it like that, coupled with future migration and population growth, if you get yourself out of that sort of next two to three-year period and you start thinking longer-term, most investors who have been through a few cycles start to understand that really, there’s nothing to see here and they’re going to play their long game and execute on their long game.  

EL: That also therefore brings us to the next part, because that’s a very, very interesting point.  The rental market is the next part of that investment story and looking at the annual changes of rents for houses that have come out today, Brisbane’s 14.1 per cent, Adelaide 12.2 per cent, Sydney 9.8 per cent year on year.  Then you go down to places like Melbourne which is only 5.7, but I say only, I mean you’re still having incredible rent change.  That’s the next question here, is do you see rents continuing to really take off because, as you said, there’s a squeeze market?  The investment market is still very much on the up over the longer-term, is that also what is still creating that attraction?   

Yeah, I think, Evan, there’s a couple of pieces to how we measure rental yields and there’s a few, like any of these sorts of things, same with median house prices, they’re quite blunt in terms of how they measure a moving market.  That said, they’re the data that we work with so let’s talk to that story.  What we’re basically seeing is, there’s going to be – we’re seeing a peak of completions that are going to occur over the next sort of 12 months.  We saw a backlog through supply chain issues, but this is a record boom in terms of completions.  So we’re going to see those people who may be renting those properties moving into their new homes which is wonderful for them, that’s going to play on the demand side and hopefully give us a little bit of supply.  But what’s charging over the hill is basically a refreshed immigration program where we are talking about potentially up to 200,000 new arrivals and skilled migrants, which is critical for our economy right now and critical for also future long-term inflation pressures to push that down.   

Ultimately, we are definitely going to see a lot of pent up demand when it comes to rentals and so you would like to think that combined with the fact that the cost of holding the property has gone up, so you are going to see landlords having to pass on some of those costs.  If I put my sort of whinging banner on, the minimum standards and also Queensland land tax, those types of things are definitely making it harder for property investors to get a risk rated return that’s satisfactory.  What was fascinating in the latest ATO data and also in the Census data when we saw the bigger snapshots, is that the amount of private rental properties is actually dropping and that’s been caused through obviously making it more difficult.   

So, you’re going to see potentially private rental stock coming off a bit and then you’re going to see all this sort of pent-up rental demand and that, for me, is definitely going to see pressure on rents over the short to medium-term.  But what we’re also seeing as part of this pattern, is during the pandemic a lot of people isolated into less dense home configurations, so it was usually a person was just renting by themselves because there was no real rental pressure, there was moratorium on rents in terms of evictions and so forth.   

Now, what we’re seeing because the cost of living for renters is also going up, we’re seeing more and more people coming into share accommodation, so Flatemates must be doing a roaring trade at the moment in terms of finding those flats so people can obviously manage their budgets a little bit better and now we’re sort of, in a way, post-pandemic into more of an endemic type scenario from a health point of view, we are going to see those patterns rise.  But, I think if I summarise that, we’re sort of talking about rental yields moving more towards their longer-term averages of around that sort of 4 per cent.  

EL: Because the flipside to that as well, what you’ve just described, is it will bring Government into play and regulation is going to be the next part of that question, taxation also.  I want to flip over because there are signs that Victoria has been debating about the ideas of making some form of rental changes and they’ve already put some fairly erroneous changes to their overall land regulation…  

Yeah, minimum standards, 133 changes to the Tenancy Act and whilst well intentioned and we always want to make sure that tenants are safely housed for quiet enjoyment of the property, the fact of the matter is a lot of those changes and compliance changes add to the cost base.  We’re talking about changes to how the fire regulations work and the ongoing testing, you have to now test for gas and electricity every time you do a tenancy rollover, they are $500 to $600 dollars each.  You’re seeing the minimum standards of the height of a rangehood has been changed, so a lot of rangehoods are no longer compliant.  The problem with moving a rangehood, that’s a redesign of a kitchen in some respects.   

So, you’re talking about well intentioned ideas but they’re ultimately leading to additional costs, property managers disputes, they’re putting their fees up because the work that they have to do is a lot more difficult.  That’s obviously then leading to property managers challenged in finding new employees to come in and do the work that they need to do, so they’re having to attract people by paying more.  All of those are flow-on costs in the system, so the unintended consequences of any type of reform of this nature, is property investors are getting frustrated so they’re leaving the market, that’s obviously reducing supply and then also their costs are going up so that’s also putting pressure on having to pass on some of those costs onto the tenants, and given the tightness in the market, they can do that.  Landlords come under a lot of greedy pressure and political debate and it really is sort of painting us as villains, but the reality is from June 2012 until June 2022, the ABS reported that rents across the country only increased by around 12 per cent, yet inflation was 26 per cent in round terms.  So, you’re talking about rents haven’t kept up with inflation over the last decade, but certainly in those last couple of years we are starting to see rents come back to where they were over that longer-term.  I think we need to be mindful of that.   

When the cost of money was going down for landlords, we didn’t ask – most landlords are mum and dads, they want to do the right thing, they want to have their tenant happy and they didn’t have to put their rents up so we didn’t see a lot of rent increases during that time because the cost of money and running those properties was going down.  But we now are definitely seeing the cost of money rising, interest rates, compliance, APRA introducing their throttles and market interventions for financial security of the system.  But what does that do?  Well, it meant that obviously interest only loans are now charged at a premium and it means that investor loans are charged at a premium over what someone would pay as a typical sort of owner-occupier principal and interest.  

Now, the data doesn’t suggest that landlords are a greater mortgage risk than actually owner-occupiers are, there’s more defaults in owner-occupied land than what there is in investor land, but you can see by APRA making those interventions, we did see that obviously that cost a lot of extra money.  In fact, the ACCC released a report in 2018 claiming that the big four banks increased their profits by $1.1 billion on the back of those regulatory changes in terms of charging more for interest only and investor loans, when prior to that intervention, market competition, there was only one interest rate variable and one interest rate for fixed, irrespective of whether you bought an investment property or whether you bought and owner-occupied property. They are the unintended consequences and just basically adds cost through the system.   

EL: Final question, the other flipside of what intervention comes from is taxation and we’ve just seen the Queensland Government come out with a new tax policy that they believe is ‘closing the loophole’, is their word, around – and the unfairness for first home owners.  Can you take us through exactly how this is going to work?  Because if you haven’t seen, they are now saying that they’re not going to just basically work out your taxation from properties held in Queensland, it’s going to be national.  What exactly and how exactly has this got through? 

BK: Well, it’s extraordinary that it has got through.  I mean, they announced it basically when they were taking out the trash, which is the term that the media used just pre-Christmas, that they were looking at this policy and then it surfaced in the budget papers which were passed, I think it was around June/July this year.  What it means, is Queensland has a threshold for the land component of which we all pay land tax on.  Land tax is a cost of doing business, we understand that in every state and territory except for Northern Territory, you pay land tax and ultimately with that land tax it’s there to raise money to provide infrastructure and services, we get it.   

Now, what Queensland has decided to do that no other state or territory has done, is that they are now looking over the fence and they’re saying that if you have property interstate, we are going to add that land portion to the land portion that you own in Queensland and we are going to use that in the calculation that effectively accelerates you past their land tax threshold and is effectively a tax grab.  Now, the problem with this, Evan, is that first of all it’s unprecedented, we’ve never seen any other jurisdiction basically look over the fence because land tax is a state-based tax and it’s going to mean a complete windfall for the Queensland Government.  But effectively, I think they’re looking short-term and not looking long-term in terms of the impact.  But the numbers that we’ve done is it’s a minimum – we can’t get the numbers to work where it’s less than a 300 per cent increase in costs of holding your properties.  Now, even the example that they used on their own website, the land tax moves from $1,950 dollars up to about $8,400 from memory, so it’s like a $6,000 dollar increase, that was a 332 per cent increase, just like that and that’s going to be effective on… 

EL: And that doesn’t include the fact that obviously if you’re in New South Wales, Victoria, SA, wherever you are, you’re obviously getting land tax in that state as well, yes?  

BK: You are, so it’s a double taxation.  They’re claiming it’s not, right?  But, yes, if you’re already paying land tax in, say, New South Wales or Victoria, you’ve got to pay that to that state government, but now you’re going to basically have a whack in terms of what you have to pay to the Queensland State Government.  Politically, their agenda is to try and again position property investors as greedy and hence, your point around getting past this loophole.  I invest in property around the country for diversification and for the opportunity that I see in that particular market, I don’t do it to avoid tax.  It is obviously a tertiary benefit that you do get, but when you’ve got a portfolio and you’ve got to think for 20, 30, 40 years, you’re going to be paying land tax in every jurisdiction that you own a property in, there’s no doubt about that, right?  

EL:Does this set a precedent too?  Does this mean that other states look at this and go, “Actually, this is a good thing for our state.”? 

BK: Well, it’s a really dangerous precedent if they are thinking like that.  If other states and territories are watching what Queensland are doing, here’s the thing, Evan, this is going to be the great Australian renters’ tax.  And I don’t say that lightly, but if you think about that example that I just used before, where this is the example on the Queensland Government land tax website, that’s $124 dollar a week increase in the cost of holding that property portfolio.  Now, no landlord is not going to be able to accommodate that cost without passing some of that cost onto their tenant.  That’s why we do believe it’s the great renters’ tax, because firstly, we’re going to go to those Queensland tenants and we’re going to say, “We’re really sorry, but based on the Government’s, not an incremental increase but we are talking about a monumental increase in land tax in that state, we’re going to have to put your rents up.” 

Now, the market’s not necessarily going to take $124 dollar increase per week, so you might be able to, say, put that up $50 dollars or $60 dollars or $70 dollars a week in Queensland, but you’re then going to look at your other properties and you’re going to apologise for your tenants in other states and territories and sort of say, “I’m really sorry, but the Queensland Government has just whacked me with another $6,000 dollar cost in addition to the minimum standards cost, in addition to the interest rate cost that I’m now paying because of the higher interest rates, and I’m really sorry, I can’t bear all of that by myself, so I’m going to put your rents up by $20 or $30 dollars each week as well.”   

And so, can you imagine how those tenants are feeling in other states?  That’s why I’m saying to, if any other state or territory Premier is thinking about this, it’s absolutely ludicrous because we are apologising to those tenants on the back of Queensland’s decision.  You can imagine the politics there, that that’s obviously all going to Queensland.  Then you’ve got to think about, this is what we’re doing in our business.  We’re sort of saying to new prospective clients, “Okay, we’ve got a plan to buy, say, two or three properties over the course of the next 10 years, here’s what’s happening in Queensland, if we go into Queensland and buy one of those properties now, ultimately it means that anything we buy elsewhere is going to be caught up in Queensland land tax.”   

So, for new purchases, they’re going, “Oh, well, let’s not go to Queensland, there’s other opportunities in other states.”  So, Queensland is going to miss out on that investment, they’re going to miss out on having critical private rental accommodation which means that rents are going to go up higher anyway in Queensland.  They’re very short-minded in terms of the actual overall economic impact.  Then you’re going to see people who have got existing portfolios where they’ve got maybe one property in Queensland and two properties interstate.  Especially if you’re in New South Wales because the land value is higher there, they’re going to potentially ditch that Queensland purchase.  Now, most people might go, “That’s good, that just means some owner-occupier is going to buy it,” but it doesn’t work as simply as that, it’s not how the rental pool market works.   

There’s a lot of people who will then – it could be a son or a daughter moving out of home for the first time and buy that as their first home, so the rental pool loses another piece of stock inside that Queensland market.  You’re going to see this horse trading going on.  Those people who have got, say, two properties already in Queensland, they may be forced to continually keep buying in Queensland instead of buying interstate, because of this.  It really is quite extraordinary policy and obviously, I’ll put my Property Investors Council hat of Australia on, I’m the Chair of that not-for-profit association, we’ll be obviously lobbying very hard to the Queensland Government to reconsider this policy, especially given the rental crisis that we’re seeing not only in Queensland but right across the country.  

It’s ill-timed, it’s ill-informed and I suspect when they think about the net gain that they might be getting, what might have been better is a smaller incremental increase in land tax across all properties in Queensland as opposed to this huge surge in land tax revenue that they’re trying to get from the percentage of people who own properties interstate as well as in Queensland.   

EL: And that is something we’re going to watch very closely over the next couple of years.  Ben Kingsley, thank you so much for your time today.  

BK: Absolute pleasure, Evan.

EL: That was Ben Kingsley from Empower Wealth. And now Pete Wargent from BuyersBuyers.com.au

EL: Pete Wargent, welcome to Property Point, it’s a fascinating time of year because it’s Spring and Spring tends to be the selling season of property.  Can you take us through what you’re currently seeing in the market and how you see the next three months, probably also the next 12 months progressing in the current environment we have? 

PW: Yeah, well very slow by comparison to the last year.  I think last year was a bit of a frenzy, it was that classic sort of FOMO environment where people were kind of fearful if they didn’t buy this week they’d be paying more money next week and there was a big rush and stock levels were very low last year.  Things have come back into balance a lot, there’s more stock on the market, still plenty of people milling around at the open homes but you can see there’s a lot of caution there and of course this is largely driven by the cost of money and I think a lot of people are just sitting on the sidelines and waiting to see what happens with interest rates and they can’t get away from it in the media at the moment but I think there’s more hikes to come and people can see that so there’s still stuff happening but definitely a lot cooler market conditions especially in Sydney in particular, the other markets now just starting to follow as well. 

EL: So on that probably the question that comes on is how far is it going to fall YOY in terms of what you see in those markets?   

PW: Yeah, so I think if you look at from the absolute peak of the market across the capital cities prices are down about 4%, Sydney is more like 7.5 to date but I suppose in context I mean in 2021 the capital cities did 24% price growth and Sydney did 27 and some of the other cities like Brisbane and Canberra did even more so in the context and some of the other cities like Brisbane and Canberra did even more so in the context of 24% price growth last year of course the slow down is to be expected.  I think if you – I mean a lot can change very quickly at the moment as we’ve seen over the past couple of years, you only need to look at what people were predicting for the cash rates even one year ago which was nothing until 2024, and so it’s a bit of a fool’s errand trying to predict these things.  I would say that peak to trough for the capital cities if I was put on the spot I’d probably say 10% and some potential for more in Sydney, further declines I would say.  As I say a lot can change pretty quickly.  

One of the things I’ve noticed in Sydney particularly first homebuyers have just completely stopped buying because there’s a stamp duty report coming in January so we’re seeing a lot of first homebuyers at open homes but they’re not going to be buying until the new year because why would they pay stamp duty now when there’s going to be a reform in a few months’ time. 

EL: We’ll get to that in a minute.  You talked about rates tomorrow is the first Tuesday of September and rate expectations are to see the RBA raising rates by another half of 1% which will take the cash rate to 2.35%.  Where do you guys see the cap at?  Where do you see the terminal rate for the RBA and what do rates look like in 2023 from your perspective?   

PW: Well the best forecaster in recent months has actually been financial markets, there’s a few commentators like Kit Low and people like that on the fixed income side who have been well ahead of the curb on this.  If I had to guess I would say 50, another 25 and then a pause and then we’ll come back in the new year and see how things are panning out.  There’s plenty of – if you look globally there’s plenty of signs of some of those supply chain issues easing a little bit and gasoline prices are down a bit and freight is starting to move and so on.  I think if you look domestically we’ve still got some of the pain to come particularly for household energy bills and electricity and so on but you can see that the increases in the cash rate to date are starting to work.  Just this morning the performance of construction gauge was out at a huge contraction in home building, apartment building, so I think we’re getting close to the neutral rate already, however we end up going we’ll have to wait and see but financial markets think there’s more to come next year so let’s see what happens. 

EL: We will indeed.  You talked about regulation there before and I think this sometimes is lost in the property investment and the property buying market is regulation is changing rapidly and is sort of lost.  Can you take us through what you think is the most positive change and the most negative change because I think that’s the question that people forget at the moment, is the regulation changes are there, what have you seen as a positive thing in the last 18 to 24 months and what have you seen as a negative change in the regulation space? 

PW: There’s different reforms going on, there’s sort of macro and micro.  I think at the macro level obviously the main policy issue is these interest rates as we’ve talked about.  In October last year the regulator introduced a 300 basis points lending assessment buffer which is huge and so we’ve never had anything that big historically and it did kind of make sense.  There was a lending frenzy going on as we’ve mentioned, a lot of investors piling in, but if we’ve got the cash rate going up to 2.35% tomorrow a 3% buffer is too big and it’s actually trapping a lot of existing mortgage holders with their existing lender, very little freedom of movement there so that’s one thing that may be on the radar is just a return to the usual sort of assessment buffer, it might go down to 250 or push 200.   

At the macro level there’s some of that going on and I think for landlords it’s been a little bit the death of a thousand cuts in recent months with some of the regulatory reforms, the reforms to the tenancy act and some of these things at face value sound like very positive moves, minimum property standards and so on.  It depends where you are in the country, like in Canberra landlords are being slugged because they’ve got things like sustainability of appliances and repairs and so on that have to go on.   In Queensland the big one is land tax.  It's a long time since I did my tax exams but the land tax proposal in Queensland seems to go against the principles of taxation as I understand them and landlords with even one investment property in Queensland can now be slugged the land tax on properties they own in Ballarat or Bendigo or Melbourne.  It’s a very unusual move and I think it will exacerbate the rental shortage in Queensland.   

There’s other stuff that has been going on as well in terms of there’s effectively been a moratorium on evictions, a lot of things which have made being a landlord relatively less attractive but of course this is all coming at a time when migration cap has been lifted to 195,000, you’ve got the temporary visa holders coming back in their droves so on the buy side of property things they’re quiet but we’re sort of heading or sleepwalking into a bit of a rental crisis at the moment because where’s everybody going to live as the borders open. 

EL: That’s sort of the next question, is all of those regulations you just highlighted, is what does it actually mean for the rental market?  We already know it’s at the tightest level it’s basically been on some records depending on which one you look at.  When you look at the examples that are going on in Ireland for example around similar things around that you’re seeing the Greens possibly proposing rental freezes, how do we get around this regulation increase that’s possibly creating a distortion in the market and actually making rental areas worse rather than better? 

PW: I think a good starting point would probably not be to be following the Green Party proposals on economics as they do tend to be a bit scattergun.  I don’t think rental caps will come into the equation.  I do think with the Labor Party there is some stuff going on behind the scenes there, there’s going to be a big push for build to rent I think particularly as it relates to affordable housing probably via super funds.  I think for the broader rental market these thins do tend to have a way of balancing themselves out over time, I think if rents go up that does tend to encourage more landlords back into the market.  I think we’ll start to see more use of share housing again which just didn’t happen through Covid.  Definitely in recent months we’ve seen a lot of Aussies overseas, they’ve been over in Greece, Italy and Paris, the summer months tend to be the busiest and there’s going to be a lot of pressure on the rental supply. 

EL: There will indeed.  Pete Wargent, thank you so much for joining me today.  

PW: Pleasure.  Thanks, Evan. 

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Frequently Asked Questions about this Article…

Saving for a property is a primary goal for many young investors because owning property is often seen as a stable and long-term investment. It provides a sense of security and potential for appreciation over time, making it a popular choice for those looking to build wealth.

The Australian housing market is experiencing downward pressure with declining hedonic values. Despite the traditional increase in supply during the spring selling season, buyer appetite remains low, leading to a cautious market environment.

Interest rates are a significant factor in the current property market, with economists predicting a cash rate between 2.5% and 3.5% by the end of the year. This has led to a stabilization in consumer sentiment, although uncertainty remains as people adjust to higher mortgage costs.

Rental markets in cities like Brisbane, Adelaide, and Sydney are experiencing significant annual rent increases, with Brisbane seeing a 14.1% rise. This is driven by a combination of high demand, increased costs for landlords, and a decrease in private rental properties.

Regulatory changes, such as increased compliance costs and new land tax policies, are adding financial pressure on property investors. These changes can lead to higher rents as landlords pass on costs to tenants, contributing to a tighter rental market.

Queensland's new land tax policy, which considers interstate properties in its calculations, is unprecedented and could lead to significant cost increases for property investors. This policy may discourage investment in Queensland and exacerbate the rental shortage.

Long-term property investors are focusing on the bigger picture, recognizing that property values are influenced by long-term economic factors like gross state production and population growth. They see current market conditions as an opportunity to invest strategically for future gains.

Increased regulation, such as stricter tenancy laws and higher compliance costs, can make being a landlord less attractive. This may lead to a reduction in rental property supply, driving up rents and potentially creating a rental crisis as demand continues to grow.