The Prosper Australia Research Institute analyses Melbourne water usage data to identify properties where so little water is used that it is likely the property is vacant. They use this to estimate the number of residential properties that are being hoarded by investors, rather than being used as homes. This year’s Speculative Vacancies report found that “Absolute vacancies using zero litres of water revealed 21,326 residential properties at 4.6% of the total rental market. The short term vacancy rate of 3.3% (SQM Research) could equate to 7.8% of investment properties if absolute vacancies were added. Up to 16.2% of investor owned rental properties were potentially vacant.” If we want houses to be used as homes instead of speculative commodities, we need to make it more expensive to keep them vacant. Prosper argues that a “reformed State Land Value Tax (SLVT) must be broadened to replace Stamp Duties. This is a more holistic technique to discourage vacancy that actively counters the market power land bankers enjoy. Such a policy switch will signal that both lazy land use and property flipping are no longer valid market activities.”
15 April 2019