Assignment:
Use a demand and supply analysis for the rental housing market to show the impact of the
following factors on the market for rental accommodation in Sydney.
Represent the analysis diagrammatically.
Assume the market for rental accommodation can be represented in the competitive market model.
a) An increase in the number of people seeking rental accommodation due to an increase in migration.
b) A government decision to increase the quantity of public housing available.
c) A change in the tax legislation to allow deductibility for mortgage interest payments against income for owner occupiers.
d) The granting of a government subsidy to the construction of rental accommodation.
e) A change in the tax legislation to remove the allowance of "negative gearing" for the taxation of landlords' income.
f) The imposition of a legislated maximum rent ("rent control").
g) Explain why rent control may fail to improve the welfare of low-income renters. What alternative policies to assist these people can you suggest?
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