A major but rarely-mentioned cause of high rent is the land tax NSW imposes on rental property owners. The current median house price in Byron Bay is $3.55 million (as per realestate.com.au), resulting in a land tax liability of approximately $39,000 a year, or $750 a week. Including the cost of mortgage, Council rates, insurance premiums, repairs and maintenance the median rent of $1,200 a week for a three-bedroom house in Byron Bay does not cover the owner’s expenses.
If the government is serious about providing incentives to build rental accommodation, the land tax for rental property needs to be drastically reduced or eliminated.
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