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Would an empty homes tax solve Tasmania’s tight rental market?

By Juliet Helmke
22 February 2022 | 12 minute read
Launceston Tasmania reb

Analysis of water usage in Tasmania has revealed hundreds of empty homes going unused in Hobart and Launceston while both cities struggle with vacancy rates below 1 per cent.

The Tenants’ Union of Tasmania obtained data from TasWater, looking specifically at the Hobart, Glenorchy and Launceston city councils to try to get a snapshot of how many homes across the city might be sitting empty.

The data spanned the past three years, capturing residential properties that had consumed less than 10 per cent (19 kilolitres) of the annual average residential water consumption of 193 kilolitres. A very low level of water usage was permissible, as they were then able to account for properties with leaking pipes or dripping taps.

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The response indicated that Hobart’s City Council had at least 192 residential properties with a “high chance” of vacancy, while neighbouring Glenorchy had 115 vacant homes. Launceston, meanwhile, is home to at least 256 unused properties.     

The union pointed out that these estimates are fairly conservative, given that the vacancy assumption was based on three years of water usage. It wouldn’t account for homes that were once occupied and have since been sold to owners who are not using them.

Using this data to create a broader picture, the union estimates that statewide, between 0.58 to 0.91 per cent of all private dwellings are going unused. These are not shacks, given that the data was collected from inner-city municipalities. Nor are they being used as short-term rentals.

In light of this research, the union is calling for an “empty homes” tax to be imposed similar to those in operation in Melbourne, Vancouver, and Paris. In the Canadian city, for example, a tax of 1 per cent of the property’s value is paid by owners who leave residential properties empty for at least six months of the year. 

After the tax was imposed in 2017, the city’s mayor Kennedy Stewart reported a 25 per cent drop in the number of empty homes. The tax has since been raised to 3 per cent, with more than $86 million raised for affordable housing.

“Amid a housing crisis, empty homes cannot be allowed to gather dust,” Benedict Bartl, the principal solicitor with the Tenants’ Union of Tasmania, said.

“We must encourage owners with empty homes to return them to the long-term rental market.”

ABOUT THE AUTHOR


Juliet Helmke

Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.

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