Vacancy a Sign of Systemic Failure
Prosper President Catherine Cashmore is quoted in The Age with Land Bankers raise ire of the well-heeled.
“Morally it’s not a good thing to do,” she said. “But let’s not blame the investors.”
She pointed the finger at government policy: “The nation has been breastfed on the notion that the way to fund their retirement is to invest in land.”
She said she knew of cases in which developers would buy up property and hold onto it, before feeding it back into the market in controlled staged releases.
Cashmore rightly directs the concern of the well-heeled towards the economic system encouraging such lazy land use.
Housing Choices Australia CEO Michael Lennon lent a supportive quote:
“There is a wider social issue here and a wider economic issue about underutilised assets,” Mr Lennon said. “It’s in nobody’s interest for assets of any kind to sit idle, including property assets.”
The next step is for government to signal a shift away from stamp duties and towards Land Value Tax. This is a more effective measure to inspire the efficient utilisation of locational advantage.
Policy makers must understand that the vacancy tax will act as a form of domestic investor protectionism.
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