Today the Greens split the Build to Rent Schedule from the Treasury Laws Amendment (Responsible Buy Now Pay Later And Other Measures) Bill 2024.

There is little evidence that Build to Rent will do anything to increase rental affordability. Mirvac has boasted about charging rents 15 -20% above market rent on their build to rent projects. This form of gentrification drives up rents for everyone in the area. In Melbourne, a Build to Rent development saw tenants evicted and then the apartments relisted with a rent hike of $185 per week.

The current ‘build to rent’ plan will see developers able to access tax concessions from the government if they build private rental apartments where 90% can be completely unaffordable, while the other 10% have to meet a weak definition of affordability. The bill stipulates that the lease period for the private rentals must be 3 years, but includes no provisions to cap rent increases or provide protections against unfair evictions.

In return for the Greens support for Build to Rent they will demand a suite of changes to ensure that 100% of the apartments are actually affordable by mandating that any developer who wants access to the tax handout must:

1. Impose a rent cap of 2% every 2 years

2. Define “affordable” as 25% of household income or 70% of market rate, whichever is lower

3. Increase the minimum lease period to 5 years

The Greens will also be pushing for:

• Minimum Energy Efficiency Ratings of 7.5 or above;

• be at minimum Universal Accessible Standard Silver Liveable Housing Design;

• extend the single ownership period to 25 years and give tenants the first right of purchase.

As the Bill already mandates that the minimum lease period must be 3 years, this demonstrates that it is perfectly possible for Labor to include more stringent lease and rental conditions.

Lines attributable to Max Chandler-Mather, Australian Greens spokesperson for housing and homelessness

“Right now Labor’s plan will see property developers and foreign investors pocket tax handouts in exchange for building unaffordable apartments that will only make the crisis worse.

“We have seen the developers in charge of private build to rent projects in Australia evict tenants and jack up the rent by hundreds of dollars, while developers like Mirvac charge rents 20% above market rent, and right now Labor’s proposal does nothing to stop that happening again.

“The Greens will support Labor’s Build to Rent bill on the condition that it is guaranteed 100% of the apartments will be actually affordable and good quality, by imposing rent caps, longer leases and linking the definition of affordability to a tenants income.

“Labor claims 10% of the apartments will be “affordable” but their definition of “affordable” would see a nurse in Marrickville paying $657 a week in rent, which is more than 50% of their take home pay.

“The Greens are willing to negotiate with Labor, but we can’t just support a proposal that will see developers pocket public money to build expensive apartments that will actually drive up market rents.

“Labor just keeps tinkering around the edges of the housing crisis. If Labor really wanted to tackle this crisis they would coordinate a nationwide rent freeze and cap, scrap the tax handouts for property investors and establish a public developer to build homes to be rented and sold at prices people can actually afford."