The opportunity of residential property investment vehicles in enhancing affordable rental housing supply

Iinstitutional investors currently play a negligible role in the private rental market in Australia. Their lack of involvement in the private rental sector has been described as a structural weakness in the Australian rental market, and is at variance with institutional investment in residential property in international jurisdictions such as the United Kingdom (UK), Scandinavia and United States (US). This research study investigates the effectiveness of residential investment vehicles in enhancing the supply of private rental properties in Australia and elsewhere. It explores the current opportunity to develop an effective residential investment vehicle to expand the supply of private rental housing in Australia, and to contribute to meeting Australia’s housing needs in the future. This Positioning Paper utilises both international and local evidence, including an AHURI survey of Australian institutional investors, to identify the broad context to residential property investment in Australia and the current and future role of property investment vehicles and institutional investors such as superannuation funds. The implications for housing supply in Australia are discussed in this context