Nearly one-fifth of all investor-owned residential properties in Melbourne lie vacant, as the number of vacant properties leapt 28 per cent in Victoria last year, The Australian Financial Review reports.
Think tank Prosper Australia's eighth annual Speculative Vacancies paper -- which analyses water usage to determine the number of homes vacant -- reportedly found 4.8 per cent (82,724 properties) of Melbourne's greater housing stock used less than 50 litres of water a day, equivalent to a dripping tap, with 18.9 per cent of investor stock using that amount or less.
Meanwhile, Victoria gave approvals for 70,472 new dwellings in the 12 months to October, The AFR says.
"When the Victorian government talks about the need to build more housing to bring down prices, that strategy isn't working. We don't have anything to ensure those homes are being utilised. It doesn't matter whether they're foreign owned or investor owned the economic cost to us is enormous," Prosper president and author of the report, Catherine Cashmore, said, with the think tank advocating for land taxes to raise the cost of holding land unproductively.
Prosper project director Karl Fitzgerald said capital gains taxes were a "much more powerful" market motive than earning rents. "That's why the tax game needs to change," he said.