Leading real estate bosses are expecting rental prices to spike across Brisbane, with investors rushing to positively gear their properties ahead of federal budget changes.
Ray White AKG CEO Avi Khan said his team had seen a jump in investor appraisals by more than 150 per cent this week, with owners looking to get the most value out of their homes.
“So many investors are thinking of increasing rents,” he said.
“A lot of investors buy properties with the future outlook of buying more.
“When they’re in the journey of one, they’re in the journey of two, three.
“When they get these properties positively geared, they’ll be able to buy more.”
Brisbane’s real estate professionals are predicting yet another spike in rents, thanks to investors pushing to positively gear their homes before federal budget changes.
The government’s latest federal budget announced negative gearing would now be limited to newly-built homes, along with a replacement of Capital Gains Tax discounts and the enforcement of a 30 per cent minimum.
These changes would be grandfathered in from July 2027 onward, meaning previously owned properties would be exempt from the new rules.
Agents have seen a rise in investor appraisals, with landlords recalculating finances before negative gearing is restricted on newly-purchased homes. Picture: Lachie Millard
Mr Khan said while the new changes would keep young investors out of the market, current investors would double down on raising rent and increasing the property wealth gap.
“If tenants are going to pay more for rent, they’re less likely to save for a deposit,” he said.
Purchases made before July 2027 will stay under old negative gearing and Capital Gains Tax rules, but the changes are expected to price out many new investors. Picture: iStock
“[Meanwhile], the previous generation got negative gearing for forty years and built property fortunes on it.
“I think what we need to encourage is more housing supply from the government. If you’re going to affect housing, the first thing you need to do is affect more supply.”
Ray White AKG CEO Avi Khan said existing investors would use the changes as a means of hiking rents, with the budget failing to meet the need for greater housing supply.
Exclusive data from a Herron Todd White (HTW) survey found 83.9 per cent of property specialists doubted the federal budget would help ease current challenges to renters and first-home buyers.
Despite potential policy changes, 85 per cent of specialists felt chronic housing supply would still be the dominant driver of price growth over the next five years.
The survey was taken shortly before the budget, based on predicted announcements at the time.
A survey of property specialists found 85 per cent believed the critical lack of supply would continue to be the primary driver of price increases over the next five years.
HTW CEO Peter Maloney said the results spoke to the desperate need for supply and immediate affordability to ease homeowner struggles.
“Demand [remains] strongest in markets that can offer relative affordability, lifestyle appeal and access to employment and infrastructure,” he said.
“The combination of population growth, constrained housing delivery and affordability
pressures is continuing to create distinct pockets of opportunity across a range of
metropolitan and regional markets.”
Herron Todd White CEO Peter Maloney said markets close to employment, infrastructure, affordable homes and lifestyle options would see high growth thanks to current conditions.
Queensland was named in the survey as the second-most likely to see the strongest property value growth over the next 12 months.
Nearly a quarter of those surveyed selected the Sunshine State as the largest growth market at 24.2 per cent, just behind NSW at 27.4 per cent.
Place New Farm agent Aaron Woolard said he had recently seen investors factor in the potential for rising rent prices. However, he found many were more focused on the growth the city would still see ahead of the 2032 Olympic Games.
Place New Farm agent Aaron Woolard said many Brisbane investors were sticking it out to see big returns later, thanks to rising Olympic infrastructure across the city.
“There’ll definitely be investors who reassess things and potentially sell or restructure their portfolios,” he said, “particularly those who’ve always heavily factored negative gearing into their strategy. But the buyers we’re dealing with are far more focused on long-term capital growth.
“Brisbane is still being viewed as one of the strongest long-term capital growth markets in the country. Compared to the southern capitals, buyers still see relative value here, and for many investors that future capital growth potential outweighs the negative gearing benefits alone.”
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