Three out of five Australian renters do not expect to ever own their home, with new research showing that many would be happy to spend more money to ensure a long-term lease.
Three in four, however, would certainly prefer to not be renting forever, according to a report released this week by AHURI (Australian Housing and Urban Research Institute).
AHURI’S report noted that the latest Australian Housing Aspirations (AHA) survey found that while a large majority (78%) of private tenants aspired to own their own home, three in five (59%) don’t think they will ever be able to afford to buy a home of their own.
Many of the respondents were also prepared to pay more for certain protections, such as:
– $127 a month for housing that meets standards above the bare minimum (such as decent insulation, regularly maintenance of heaters and coolers);
– $72 more for indefinite leases (subject to rent being paid on time); and
– $77 to cap rent increases at 5% every 12 months.
Lead researcher Professor Emma Baker says the results show a significant shift requiring rethinking of tax and housing systems so that both state and federal governments support all Australians in a two-tier housing market (of owners and renters) into retirement.
“The policy challenge is to make renting a good, long-term housing outcome for renters, particularly lower-income, older renters with limited superannuation”, she said.
Baker also noted that currently, homeowners receive tax concessions that are not available to renters, such as no capital gains tax on the sale of the primary residence (which becomes a form of wealth accumulation) and no tax on the imputed rental income of owner occupied housing.
“Conversely, renters are required to pay rent after income tax”, she added.
“A fairer housing and tax system (for retirement investment) could see some lower income private renters compensated for living long-term in the sector. This support could come through the provision of non-property investment opportunities (to reduce households’ need to ‘rentvest’) or targeted superannuation benefits”, Baker concluded.
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