'Not going to do anything': Businesses bemoan government's $10,000 Airbnb incentive
Hospitality vendors in WA's South West say a chronic shortage of staff accommodation is crippling their businesses — and new government initiatives to try to solve the problem are inadequate.
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Really? Why reward people for taking away opportunities from others and artificially inflating property values?
Investment properties should not be a thing. AirBNB should not exist. This is what is causing the housing crisis, and providing grants to the people responsible for this mess so that they are slightly less selfish isn't going to help.
I don't even think we'd need to go that far. Also there is a place in the market for rentals, short and long term, its just taking up too much of the market. Therefore it just becomes a matter of the government augmenting the market.
Increase the comparative costs of these activities by minimising the existing incentive structures and people investors will self select out. The rental/investment property market becomes smaller, and a large vector of demand eases upward price pressure on housing.
The tricky part is, as soon as a government starts hitting investors, they'll complain and hit back, then if the rental market is squeezed that'll have an electoral effect also. This is why i'm thinking the HAFF from the federal government is maybe a good place to start the process. Because you, hopefully, remove a whole section of the lowest, most at risk people in the housing investment sector, nullifying the most poignant attacks if other policies were to come in.
I have yet to hear an argument for private rentals where public housing would not better serve the people. I agree that the challenge is that the government is concerned about pushback from investors (with a large splash of self-interest thrown in by landlord politicians).
The HAFF is a next-to-useless bandage that does nothing to actually resolve the issues of investors massively driving up housing prices alongside irresponsible population increase. 40,000 homes spread over 5-years will not do anything when we're granting 200,000 permanent visas every year.
Okay, i'll give it a try, see what you think about this reasoning.
Private rentals can be a useful system, because it 1. disperses the responsibilities and, 2. increases the incentives to develop and maintain the system. 1.Dispersion of responsibilities is so important in so many contexts. In this context, in theory, it should give government a more free hand to set up an independent regulator to oversee that market ensuring standards are maintained against many smaller investors who due to their market stake aren't able to tailor the market to their own self interested ends. 2. The increased incentives to develop and maintain the system mean renters aren't left in terrible housing paying through the nose for, because the owners of those dwellings will quickly find no one wants to rent their dwellings.
Note: I am in no way attempting to say this is how Aus is working currently. For example, the second advantage is failing in our current market, due to the short and long term, public and private supply constrictions that have been allowed to continue when the population has been increasing. The first advantage is probably also failing a little due to the costs to the renter of taking action and a fairly reactive regulator.
I appreciate your response and your explanation, but I disagree. The dispersal of responsibility from a tenant to a private landlord has no advantage over public housing. Tenants in the current market are afraid of rocking the boat because landlords are en masse holding them over a barrel. I like your theory that dispersing the responsibility from the state to market forces will help with regulation, but fortunately, we don't need to hypothesise because, as you noted, we already live in a private market and can see how shit regulation is, and how shit it has been for a very long time.
This incentive you mention doesn't seem to be enacting any real change with regulation. Sure, over the past few months, the state governments across Australia have enacted 'progressive overhauls' on tenant rights, but almost universally, these overhauls are ignoring the actual issues and are very clearly designed to just look like they're doing something. The Federal response is even worse. On one hand, they are forced to make miniscule concessions by the Greens to make their band-aid slightly less rubbish, and on the other, they exacerbate the pressures on the housing market by slashing taxes for the rich and boosting migration.
We've already tried regulation, and it has been an abysmal failure (to everyone except landlords).
Fair enough, i had a go.
There are systemic problems that we aren't tackling in the housing system. I'm more willing to give plans a chance, but i won't defend bad policy.
At the Press Club address during the week Malcolm Turnbull had some good advice for the Federal government and their HAFF. He said ~ 'If it's not working about as expected in two years, don't be afraid to drop the policy.' A good reminder of the sunk cost fallacy for them.