Skip to content Skip to main navigation

News

Skilled legal advice with
accessible & personal attention

Greens spit dummy over renter massacre rejection

By johnboy - 15 February 2012 11

The Greens are having a major dummy spit after their plans to screw the renters of Canberra in the name of energy efficiency was defeated by a Labor/Liberal alliance in the Legislative Assembly:

“The Government is effectively leaving 1/3 of Canberrans out of its plans to improve energy efficiency,” Greens Climate Change spokesperson, Shane Rattenbury MLA, said today.

“Simon Corbell identified energy efficiency in buildings as a major plank in the Government’s climate change strategy, arguing it would both cut emissions and costs. Today however he voted against these benefits for renters, stating that it would cost too much. In reality, the Government’s costing of the Bill assumed gold-plated standards.

“The Canberra Liberals opposition to this bill exposes their true colours when it comes to cost of living pressures on Canberrans doing it tough. They voted for higher energy bills for renters.

“I came to this issue in good faith and the Government responded with dodgy modelling, scaremongering and negative rhetoric.

“That both Labor and Liberal refused to engage with the long development and consultation process for this Bill shows a lack of concern for Canberra’s renters,” Mr Rattenbury said.

Speaking as a renter, I am positively relieved.

UPDATE: Simon Cobell has given his reasons for opposing the bill:

“Although I support moves to improve the standard of rental accommodation for renters, this bill is a blunt instrument that would increase rents and reduce the supply of rental homes,” Mr Corbell said.

“It would have imposed a direct cost burden on lessors, who would need to meet the new requirements or risk action being taken against them by the Office of Regulatory Services or the ACAT.”

Mr Corbell said this direct cost would inevitably have been met by tenants, who would have been charged higher rents to meet the costs of the necessary improvements.

“These increases would have caused an increase in the CPI for rents, which would have caused a general rise in rents throughout the ACT rental market,” he said.

“There is also a real risk that these changes would have reduced the vacancy rate in the Territory, at a time when there is already a very low vacancy rate.

“This is because many lessors would have simply been unable to afford the raft of required improvements and taken their rental properties off the market, while potential investors would have been deterred from investing in older rental properties.

“An operational review of the Residential Tenancies Act that considers a range of tenancy issues, including the likely effects of mandating or providing incentives to lessors to improve rental properties would be a more appropriate place to tackle this issue.

“My directorate will be conducting a review of the Act which will include consideration of ways in which the standard of ACT rental stock may be improved with less cost impact.”

What’s Your opinion?


Post a comment
Please login to post your comments, or connect with
11 Responses to
Greens spit dummy over renter massacre rejection
HenryBG 12:47 pm 16 Feb 12

Jim Jones said :

devils_advocate said :

Jim Jones said :

Assuming that the rental market actually works that way, …

I am genuinely interested to hear arguments against this assumption.

Made in the previous thread relating to the issue: http://the-riotact.com/greens-plan-to-make-rental-more-expensive-back-on-the-table/65591

The most convincing argument (IMHO) would be that landlords are highly unlikely to kick out tenants (and thereby lose rental profits) in order to carry out relatively minor work. And most rents in Canberra go up by the legislated maximum anyway.

Regardless – personally I think it’s well intentioned legislation that would probably see a slight rise in some rental prices. Some short term pain in the pursuit of long term gain.

Not gonna happen anyway.

Agreed. The way to do it would have been to introduce the requirement for a new certificate of insulation/etc.. compliance with each new Transfer registered at ACT Land Titles.

This would add to the price of property transfers across the board, but the prices are already so ridiculously high it wouldn’t make much difference.

The only downside to thse sorts of initiatives is that they create more money-making opportunities for the same kind of shonky BMW-driving tradesmen who stuffed-up the federal insulation program.

devils_advocate 12:37 pm 16 Feb 12

Jim Jones said :

Regardless – personally I think it’s well intentioned legislation that would probably see a slight rise in some rental prices. Some short term pain in the pursuit of long term gain.

Not gonna happen anyway.

Well I don’t want to become a billion-post nutbag but the simplest analogy I can think of is cigarette prices.

It’s probably fair to say that the market for cigarettes is pretty competitive. There are a number of suppliers, its a relatively homogenous product, and sold pretty much everywhere.

When the government increases the excise on cigarettes, the persons legally responsible for paying the tax are the cigarette producers/suppliers themselves. But, the price goes up instantly and uniformly and the consumers end up paying more. And no it’s not the result of a massive price fix.

Now demand is relatively inelastic for cigarettes – each time the excise goes up there is a small demand side response but not much.

The comparison between the excise (tax) and this initiative is apt because both raise the cost base of the supply side and both are compulsory.

There are of course some differences – supply of houses is fixed in the short term, and despite how essential cigarettes are to a smoker, I’d argue housing are more essential to people in general.

But it provides an illustration without having to actually resort to illustrating it with graphs (or worse still, real life experiments).

Jim Jones 12:14 pm 16 Feb 12

devils_advocate said :

Jim Jones said :

Assuming that the rental market actually works that way, …

I am genuinely interested to hear arguments against this assumption.

Made in the previous thread relating to the issue: http://the-riotact.com/greens-plan-to-make-rental-more-expensive-back-on-the-table/65591

The most convincing argument (IMHO) would be that landlords are highly unlikely to kick out tenants (and thereby lose rental profits) in order to carry out relatively minor work. And most rents in Canberra go up by the legislated maximum anyway.

Regardless – personally I think it’s well intentioned legislation that would probably see a slight rise in some rental prices. Some short term pain in the pursuit of long term gain.

Not gonna happen anyway.

devils_advocate 12:02 pm 16 Feb 12

markus_k said :

Assuming a fairly conservative $300 a quarter energy bill, the reduction would have to be more than 40% to offset even just a $10 dollar a week rent increase. Not very likely.

And even that is assuming that the landlord only raises the rent by the amount required to cover the renovations – as noted several times on the previous thread, once the lease gets broken rents would be likely to increase to meet the market rather than merely recoup the cost of renos.

markus_k 11:56 am 16 Feb 12

JessP said :

Assuming that the rental market actually works that way

Lessors generally do tend to charge more rent the more a property is costing them to own, yes.

JessP said :

and assuming that rental increases wouldn’t be offset by the reduction in energy bills.

Assuming a fairly conservative $300 a quarter energy bill, the reduction would have to be more than 40% to offset even just a $10 dollar a week rent increase. Not very likely.

devils_advocate 11:53 am 16 Feb 12

Jim Jones said :

Assuming that the rental market actually works that way, …

I am genuinely interested to hear arguments against this assumption.

devils_advocate 11:49 am 16 Feb 12

Bramina said :

Perhaps there should be a way of rating home. This could send a clear signal to buyers and renters that they could use to factor heating costs into the price of the buying/renting.

Well now that it’s safe to discuss sensible solutions, my first thought was that mandating EER ratings when advertising RENTAL properties (as opposed to sales) might be a useful step.

At first I thought “how dumb are these people, can’t they tell by looking at a house and what kind of heating it has, and even having a look in the manhole to see the insulation, and whether it’s a centuries-old house in Ainslie, the relative cost of heating/cooling relative to other options?”

But then I realised that real estate agents probably either don’t know, can’t risk getting it wrong or are reluctant to disclose. So then prospective tenants are in the invidious position of having to personally attend each house to form their own approximation of what the EER/costs are likely to be.

So, to illustrate this idea, imagine if you were browsing through allhomes or whatever looking for rentals and it just had that column at the end that said the EER? (like it does with the sale properties). Would certainly cut down on search costs.

In theory, (and controlling for all other variables) the more energy efficient houses would be in higher demand, and the price mechanism would work better. Of course this would require tenants to actually take some responsibility and factor in the EER into their decision making process…

IIRC, the cost of getting a home EER rated wasn’t prohibitive, a few hundred dollars (assuming the owner doesn’t have one already – anyone that purchased since early 2000’s would have one). Certainly cheaper than mandating minimum standards, and instead of interfering in the market would actually make it operate more transparently.

Jim Jones 11:45 am 16 Feb 12

JessP said :

Well done Greens, the 1/3 of Canberrans who have to rent – in an already expensive market – would really have appreciated the INCREASED rents imposed by their landlords to fund the improvements.

Assuming that the rental market actually works that way, and assuming that rental increases wouldn’t be offset by the reduction in energy bills.

JessP 11:05 am 16 Feb 12

Well done Greens, the 1/3 of Canberrans who have to rent – in an already expensive market – would really have appreciated the INCREASED rents imposed by their landlords to fund the improvements.

milkman 7:38 pm 15 Feb 12

Good to see come common sense prevail. The Watermelons could learn something from this.

Bramina 6:25 pm 15 Feb 12

Perhaps there should be a way of rating home. This could send a clear signal to buyers and renters that they could use to factor heating costs into the price of the buying/renting.

Related Articles

CBR Tweets

Sign up to our newsletter

Top
Copyright © 2017 Riot ACT Holdings Pty Ltd. All rights reserved.
www.the-riotact.com | www.b2bmagazine.com.au | www.thisiscanberra.com

Search across the site