Australia’s Housing Crisis: Can Build-to-Rent Live Up to Its Promise? - Property Inc

Australia’s Housing Crisis: Can Build-to-Rent Live Up to Its Promise?

Australia is currently grappling with a housing crisis, characterized by rising rents and falling vacancy rates. In response, some experts have pointed to build-to-rent housing as a possible solution, but questions remain about its viability and accessibility for middle- and low-income earners.

Build-to-rent housing, which is relatively new to Australia, is a form of rental housing in which a property is held in single ownership and professionally managed. The concept offers tenants the flexibility of renting with the security of home ownership, as the property is held for the long term. A recent report by Ernst & Young, commissioned by the Property Council of Australia, found that support for build-to-rent housing could result in an additional 150,000 homes over the next 10 years.

This type of housing is more common in the UK, Europe, and North America, where millions of units have been developed. Professor Hal Pawson from the UNSW City Futures Research Centre noted that Australia’s tight vacancy rate of 1% in February, combined with a 24.1% increase in rent values since September 2020, highlights the need for alternative solutions like build-to-rent.

However, some experts argue that build-to-rent properties may not be accessible to average Australians. Sydney University economist Dr. Cameron Murray questioned the need for tax breaks, as build-to-rent projects are already underway under current tax rules. He also suggested applying GST to residential rentals as an alternative way to level the playing field.

While build-to-rent has been hailed as a potential solution to the housing crisis, Professor Pawson cautioned that it is “sometimes oversold” and will not solve the affordable housing problem on its own. Dr. Michael Fotheringham, director at the Australian Housing and Urban Research Institute (AHURI), added that government subsidies are essential for making build-to-rent an affordable option.

The housing crisis is also impacting regions like the NSW Hunter Region, where rental costs are increasing rapidly, and industry bodies are calling for reform. State MP Yasmin Catley said the state government is committed to creating a portable bond scheme, introducing a rental commission, and putting an end to secret rent bidding. However, it has ruled out rental caps as a solution.

As Australia’s housing crisis deepens, the debate over build-to-rent’s potential benefits and drawbacks continues. Tenants Union of NSW CEO Leo Patterson Ross urged caution, stating, “The promises of build-to-rent are very attractive… but we have to be cautious about whether the outcomes will meet those desires.”


Broucher, Dina Lewis. “It’s touted as one solution to Australia’s housing crisis, but what is build-to-rent? And can it live up to the hype?” ABC News.

Swaine, Sarah. “‘It is getting worse’: Rental crisis hits NSW’s Hunter region.” 7NEWS. 

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