Page 1987 - Week 06 - Tuesday, 5 June 2018
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The minister’s desire to promote model behaviours by landlords is quite interesting and I must point out that the minister offers no real reason for us to move in that direction. In other words the minister is saying that landlords’ failures to demonstrate model behaviour are sufficiently prevalent for us to impose this legislative discipline. I have not seen that failure. It would be useful for this chamber to see the extent to which those who rent out their property are not displaying model behaviours or are breaching these. In fact it would be useful to see exactly what these model behaviours are, along with the data on the breaches or aberrations. I am sure the minister will point out in his speech in response that in the private sector there are very few of these orders that are put into place. If that is the case why would we go down this path?
I note that as recently as August last year the Commissioner for Fair Trading put out the Renting Book which you would think might be sufficient guidance for tenants and lessors. The Renting Book spells out the obligations and requirement of lessors and tenants, along with channels for dispute resolution and guidance on who is responsible for expenses and costs. I would think that this would be sufficient prescription and guidance but apparently it is not. We need more obstacles, more frustration imposed on lessors.
We need to remind ourselves that most lessors have gone into debt to establish their rental property and they have assumed a significant risk. They have contributed or will contribute to the ACT’s accommodation supply by investing and taking a major financial risk. They are doing so. They are compelled to pay outrageous levels of rates and land taxes—all into the government’s coffers. On top of this when they purchase their property they have to or will fork out towards the $30,000 slug per unit for the lease variation charge. When you take into account what small investors, including many mum and dad investors, are borrowing and are repaying it would be fair to say that there are also large numbers of vulnerable lessors, which I know is a concept that does not strike those on the other side.
There are those who have gone out on a financial limb to buy an investment property and their margins are so thin, particularly early in the mortgage, that, if after a period of no rental income they have a further three or four weeks without it because of this process, they risk losing their investment property. Why is that risk not taken into account by this government?
I love it how those on the other side assume that everyone who owns an investment property is rich and evil. And when those on the other side consider the word “landlord” I think the first thing they notice is that it has the word “lord” in it. The position from those opposite is that property investors have money and lots of it; so let us squeeze as much out of them as we possibly can. When you take this bill into account, with all this government’s other budgetary measures aimed at property owners, there is a significant and growing disincentive for individuals to invest in property. And that is not going to serve anyone well.
We could end up with a situation where small investors cannot receive a sensible return because government taxes and fees are eating away at their returns. And when you add this additional risk—and there is a risk, it is a genuine risk—it is enough to
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