The Merri-bek council’s move to weigh doubling rates for landlords has sparked intense debate, with advocates arguing it will make way for first-home buyers in the area while fellow councillors vehemently oppose the move.
Sky News host Rita Panahi says a hard-left councillor in Melbourne’s north wants landlords to pay quadruple the amount of tax compared to owner-occupiers.
“This councillor was on 7 News, doubling down on this lunacy,” Ms Panahi said.
“They don’t need landlords in Merri-bek; nevermind that around a third of the residents of that council happen to be renters.”
The plan to double the rates for investors is aimed at making the Merri-bek municipality “less attractive” to landlords looking to invest in the area.
On average a typical home owner in Merri-bek pays $1,800 per year in rates, with businesses up for about $2,700.
The Merri-bek council’s consideration of doubling rates for landlords has sparked intense debate, with advocates arguing it will make way for first-home buyers in the area, while fellow councillors vehemently oppose the move, labelling it as destructive and driven by socialist ideology.
Councillor James Conlan, who put the motion forward, seconded by Councillor Angelica Panopoulos, said the ideal way forward would be to double the rates for investors while reducing rates for homeowners and local businesses by half.
If applied, based on the average property value of a home in Merri-bek of $800,000, homeowners could see a rate cut of around $900 a year on average.
James Conlan, the Merri-bek councillor who put forward the controversial motion. Picture: Merri-bek Council
The Merri-bek municipality includes suburbs like Brunswick, Coburg, Glenroy and Pascoe Vale.
“That is a significant cost of living relief for homeowners across the municipality – paid for by charging those who can pay more, which is people who own investment properties,” Mr Conlan said.
“I know some of them have talked about having increased costs, but investors don’t go homeless when they sell a property – they’re able to liquidise that asset and pay additional charges such as higher council rates”
Mr Conlan based his motion on the concept of redistribution of wealth through taxation and progressive taxation ( higher tax rates as taxable income increases) – which Australia employs.
One of the aims of the motion is to make Merri-bek “less attractive” to property investors, as according to Mr Conlan renters have “no rights”.
“The idea behind that is when investors leave, more priorities will become available for first home buyers -that’s a really great outcome.”
Mr Conlan suggested the severity of the cost-of-living crisis means that a council rates notice could serve as the last straw for a struggling renter, pushing them into financial stress.
New South Wales Libertarian Party MLC John Ruddick says “no new houses” would be built if a councillor in north Melbourne had his way with housing policy.
A hard-left councillor in Merri-bek wants landlords to pay quadruple the amount of tax compared to owner-occupiers.
“The existing stock would go into decay because it’s just not worth me owning an investment property and renovating it and keeping it in good shape,” Mr Ruddick told Sky News host Rita Panahi.
“It’s very sad that we can have people like this elected to council.”
The motion was approved six to five, but one councillor, Oscar Yildiz, fiercely opposed the concept, placing his head in his palms and shaking in disapproval while Mr Conlan explained the rationale.
“I’m absolutely flabbergasted with this motion,” Mr Yildiz began, adding that it was “one of the worst motions” he had heard.
“This is not productive, it’s definitely not cohesive, it’s nothing but destructive.
“This is just dumb micro and macroeconomics at play here”.
Ahead of the council meeting, Mr Yildiz took to social media – labelling the idea as “the Socialist and Greens Ideology”
“Let’s double the rates for hard-working mum and dad investors because they are cashed up and surely they can afford it, I mean they didn’t work hard for their money, they picked it from the trees on their nature strips!!!”
“If this stupid motion gets up tonight, we will yet again be the 1st Council in Victoria to appear in National Headlines for the wrong reasons.”