We Saw It Coming: How Policy Failures Fuelled the Rental Crisis – and Why ‘Mum and Dad’ Investors Must Be Part of the Solution
Australia’s rental crisis didn’t appear overnight. It’s the predictable result of years of compounding decisions—at both state and federal levels—that slowly squeezed supply, discouraged private investment, and failed to plan for population growth and changing housing needs.
With rental vacancy rates at record lows and prices soaring, it’s clear we’re living through the consequences of policies that ignored long-term impacts.
The Warning Signs Were Clear
For over a decade, property investors—particularly so-called “mum and dad” landlords—have raised red flags about growing red tape, tighter tenancy laws, rising land taxes, and the erosion of incentives that once supported private investment in housing. Simultaneously, governments reduced their involvement in direct public housing provision, shifting the housing burden more and more to the private sector—without giving it the tools to cope.
Planning bottlenecks, slow development approvals, and restrictive zoning in major cities only worsened supply constraints. Meanwhile, immigration resumed post-pandemic at pace, increasing demand just as investor numbers dropped sharply.
Private Investors Are Essential
The vast majority of rental properties in Australia are provided by private individuals—often everyday working Australians who own one or two investment properties as a form of retirement security. These mum and dad investors are not faceless corporations; they are the backbone of the rental sector. Yet they’ve been overlooked and over-regulated, pushed out of the market by disincentives that make investing unviable.
If the government cannot meet demand through social and affordable housing programs—and clearly, it cannot—then it must embrace the private sector as a key part of the solution.
The Way Forward: Incentivise, Don’t Penalise
To ease the rental crisis, we need a pragmatic policy reset. That means reintroducing targeted tax breaks and incentives for property investors, particularly those willing to offer long-term leases, build-to-rent properties, or invest in areas of high demand. Land tax reform, faster approval pathways for rental developments, and reduced compliance burdens could also make a real difference.
Instead of vilifying landlords, we need to encourage responsible investment. The private rental market must be seen not as a problem, but as a partner—an essential part of solving the housing crisis.
The warning signs were there. The time to act is now.