Planned changes to Queensland Land Tax rules will worsen the current housing crisis, a leading City of Logan real estate agent warned.
Avi Khan, principal of Ray White AKG, said the changes were “nonsensical”, and were a revenue grab by the Queensland Government.
Under the new rule, passed by the government on June 24, the government can use the total value of an investor’s land holdings, including those owned interstate, to calculate land tax.
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“You have got to question the motive, all this talk about affordability, they are putting another tax on, making it harder, not easier,” Mr Khan said.
“Why close the borders to investors? They are being punished for their interstate holdings.”
With no consultation with industry, Mr Khan said the decision could drive investors out of the market, with no new owners joining the market.
“There are lots of stories about people staying in caravans and so on, because there is nowhere to live in houses, but the government does not care about affordability, they say the changes make it fairer, but who is it benefitting – not renters or owners.”
With his business managing more than 1000 properties in Logan, Mr Khan said more than 70% of owners have properties interstate.
“This is a self-imposed own goal from the state government. They have set a number themselves, they did not consult with anyone, this is a government that does not consult.”
Mr Khan said there is a perception investors are rich, but said many are just “normal people”, using investments to pay for children’s education or to set themselves up for retirement.
“This is like cloak and dagger legislation, the government is increasing barriers to people participating in the market, landlords are very concerned, what if other states do the same? People are being taxed two or three times,” Mr Khan said.
“Some owners are saying they might sell, and won’t buy any more Queensland properties.”
With owners saying they would pass the tax increases on to renters, Mr Khan said there are limits to what the market can absorb.
“If the market can’t sustain it, then they will likely sell. The government talks about affordability, then they do this.”
Mr Khan said rents have increased recently – despite house prices stabilising – due to a range of factors, including property maintenance costs, and mortgage increases due to interest rate rises.
“There are no new builds, so we are seeing rental prices staying high. We can’t see any relief, the rental cycle takes longer to correct,” he said.
“All we ask is they listen to the industry.”
