Ewan’s Hot Take: Rental Affordability Crisis

The rental crisis is causing landlords to sell their properties to owner-occupiers, leading to a decrease in rental stock in the market. This is due to landlords being negatively geared, which means they are paying more to hold the property than they receive in rent, and they are not seeing enough capital gain with interest rates having rocketed up. However, the market has held up, and good properties are still selling strongly, with a 10% increase over the years. This means landlords have been able to sell their properties at a good price, leading to a decrease in rental properties available for tenants. Additionally, more investment choices are available for people, such as investing in funds, which are more liquid than property. As a result, there is a need to attract landlords back into the market and to encourage more people to invest in property. However, buying a property that has been rented for years might be a good opportunity for first homebuyers. Despite the crisis, property prices have remained solid and are still considered a safe place to invest money.