Rental Affordability Hits Crisis Point in Australia
29 November 2018 at 8:00 am
Single mothers are paying up to 70 per cent of their income on rent, with new research showing rental affordability is at crisis levels for low-income families in Australia.
The latest Rental Affordability Index (RAI), released on Thursday, found while rental prices have improved marginally in some cities, these gains have not flowed through to low-income households struggling to make ends meet.
More than a million Australian households currently need some form of housing assistance, while 45 per cent of low-income households experience rental stress – defined as paying more than 30 per cent of their income towards rent.
The RAI measured rental affordability relative to household incomes based on new rental agreements.
Hobart edged out Sydney as the least affordable city to rent in Australia, with Hobart households even on average incomes at risk of rental stress.
“Developing infrastructure and housing goes hand in hand, it’s not a stand alone issue” Doug Cameron, Australian Labour Senator, on #affordable #housing at the launch event of the November Rental Affordability Index tonight @CSBanking @NationalShelter @Brotherhoodinfo pic.twitter.com/wqiPzDZ3yn
— SGSEP (@SGSEcoandPlan) November 28, 2018
Ellen Witte from SGS Economics and Planning – which prepared the RAI along with National Shelter, Community Sector Banking, and the Brotherhood of St Laurence – said she was particularly worried about single parents with children.
“There are 110,000 single-parent, low-income households out there living in rental stress and 82 per cent of those households are single mothers,” Witte said.
“The majority earn $41,600 per annum or less. In Sydney they would be paying about 70 per cent of income on rent, which is clearly unsustainable.”
Low-income renters are also set to be hurt by the looming closure of the National Rental Affordability Scheme (NRAS), which provides incentives to housing providers offering rental properties at least 20 per cent below market rates.
Single mother Melissa Jones has lived in a Horizon Housing NRAS property on the Gold Coast for the past four years raising three children aged four, seven and 15.
She said she fled Hobart to escape a violent ex-partner and relies on the disability pension to get by.
Jones told Pro Bono News she feared the loss of NRAS subsidies would force her family onto the streets.
“If NRAS ends in the next few years than I’ve got nowhere to go. I’d lose my car, I’d lose everything,” Jones said.
“This scheme has enabled me to build a life for myself and my children free from domestic violence. Without it I’ll become homeless.”
Jones said there was a dire need for more affordable renting options in Australia.
She urged the federal government to create another scheme to protect single mothers and other low-income renters when NRAS wraps up.
“People with partners might be okay because you can pay one week’s rent and they can pay the other, but the ones doing it on their own like me don’t have the option,” she said.
“We need long-term and affordable housing, especially for single mothers that might have a disability or can’t return to work, because we can’t do it on our own.”
“The tax regime treats housing as an investment objective first and as a place of residence second” – Ellen Witte, SGS Economics and Planning.
— SGSEP (@SGSEcoandPlan) November 28, 2018
There are around 244,000 low income, single-person households experiencing rental stress in Australia – 57 per cent of whom are single men.
Rental affordability for single pensioners was also found to be alarmingly poor in all Australian capitals and almost every regional area.
The RAI report said pensioners would have to move to regional South Australia to find accommodation that did not force them into rental stress.
Conny Lenneberg, the executive director of the Brotherhood of St Laurence, said the RAI showed those who could least afford to pay rent were suffering the most.
“High rents are pushing unemployed people on very low Newstart payments into deeper poverty,” Lenneberg said.
“Housing cost pressures mean some renters on Centrelink are being pushed into homelessness. We need to raise Newstart and its very modest rental supplement as a priority.”
Lenneberg called for governments to urgently increase subsidised social housing.
“The cost of renting in the private market puts many low-income single parents, usually women, under extreme pressure. Many parents forgo basics such as food and paying household bills to keep a roof over their family,” she said.
Adrian Pisarski, the executive officer at National Shelter, called for a National Housing Strategy to improve the situation for low-income renters.
“While we have many housing markets in Australia, none of them are positive for renters. We need a multi-party commitment to improve rental affordability over the long term,” Pisarski said.