Recently, much has been made of the affordability of housing in Australia and the corollary that there at present exists a group of society who have been or will be priced out of home ownership and will be required to rent for, presumably, time immemorial. That group of society it is often pointed out are generally called Arts students but that they exist at all, the group, not Arts students, should be of some concern to anyone with a sense of fairness. That the situation doesn't bode well for the country is surely a given. It also doesn't bode well for those of us who fear nothing more than an evening out ruined by someone banging on about house prices (yes, I'm looking at you pre-2000 Sydney, 2002 to 2008 Perth and present-day Melbourne).
To my mind, and I should say from the outset that politically I sit a little to the left of Karl Marx, houses are for living in and impressing cab drivers but are not and should not be seen as an investment opportunity; as much for the peril of conversations about house prices as any socio-politico-psychological stand point. Don't get me wrong, a person should be allowed to own as many houses as they like, but their ability to pay for those additional houses off the back of rental returns should be severely curtailed.
To that end I propose a single-rule-and-single-exception system whereby the rent chargeable on any residential dwelling is frozen from the time a tenant moves in until such time as they leave. Significantly, and crucially, if the house is sold, the tenant remains and the new purchaser is bound by the existing rental. The single exception is that if that purchaser moves into the (now "their") new place, the tenant is out.
To my mind, a mind not without its own flaws I readily accept, the system creates value for purchasers who want to live in the place and places a burden, sometimes an almost delightfully onerous one, on so-called investors. It also provides some comfort for tenants who feel home ownership is beyond their grasp. It is not, however, sufficiently rigid, nor does is provide sufficient security to completely set aside the risk that one day the house you are renting for a bag of Chicos a day (I don't care for peanuts) will be sold and purchased by someone who wants to live in it. In that respect, I agree, it probably doesn't go far enough, but it's a starting point.
By way of example, while initially $500/week for a [insert type of dwelling in a location you choose] will seem a normal rent, in a few/five/10 years' time, it will be a positive steal. And let's face it, if a landlord can afford to rent a place to you for $500/week today, they can afford it in 2020 or 2050. It follows that an owner-occupiers' home will fetch more on the open market than an identical house that is being rented (where the purchaser is an investor), that below-market renters will be able to save money to purchase their own homes and that, if there is a God, the number of real estate agents will be severly reduced.
The naysayers will (nay)say that people will simply never leave a place, but they will. Singles become couples, couples become families and families grow and, eventually, shrink. The system will provide a foundation and financial incentive for purchasers of homes rather than houses. As it becomes entrenched, with any luck having an investment property will be so on the nose that the owners of them will be shunned from groups they would otherwise like to number amongst.
The system will undoubtedly be open to abuse but, frankly, what system isn't?
And before you scream, "You wouldn't be saying this if you owned a place/put your money where your mouth is/aren't you the guy that can't even get a scooter license?"; I already do and I already have (and yes, I am). I currently rent an apartment to a friend and, as God is my witness, will not raise that rent for as long as she wishes to remain there. So Brooke, if you're reading, there you have it.
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