Rental affordability slide continues
New research released today by National Shelter, Community Sector Banking, the Brotherhood of St Laurence and SGS Economics and Planning has revealed that rental affordability is hitting crisis around Australia, especially for low income households struggling to make ends meet.
The latest Rental Affordability Index (RAI), released today, 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 rental data. The report notes that a high overall RAI in the ACT is driven by the relatively high income of the ACT’s average rental household. Low income households in the ACT face particularly unaffordable rents, however, as rents are pushed up by the overall high income earning workforce.
Travis Gilbert, Executive Officer of ACT Shelter, said that the figures showed that the slowdown of the housing market reported generally was still not trickling through to more affordable outcomes for those most at need of relief.
“Despite the hype about a market slowdown, the reality is that this is not trickling down to more affordable outcomes for Canberrans in rental stress. The report shows when we talk about unaffordability for renters we are not just talking about people on part-time incomes or outside the workforce. We spent a good deal of money recruiting graduates to the ACT to work in the APS. What our ‘See yourself in Canberra’ ads don’t say is once you get settled, you find yourself in housing stress.”
Mr Gilbert warned affordability continued to deteriorate.
“In reality the report notes that an update to household income data reveals that the ACT has not been performing as well as previously estimated and a marginal but consistent decline in rental affordability can be seen in the Australian Capital Territory from the December quarter of 2016 to the close of the second quarter of 2018.”
According to Susan Helyar, Director of the ACT Council of Social Service (ACTCOSS), a worrying aspect of the research was the news that areas across the inner city and suburbs have moved from ‘Moderately Unaffordable’ to ‘Unaffordable’.
“We have always said that affordability in Canberra was a tale of two cities, with relatively high incomes masking the fact that this city remains very unaffordable to some groups of people in some parts of the city. What this report also tells us is that more places in Canberra are now being pushed onto the red side of the ledger.
“This will not right itself. There is no room for complacency, and action is required from ACT and Federal governments.
“The new ACT Affordable Housing Strategy must be promptly delivered with coordinated action across portfolios and independent oversight, strong accountability and rigorous reporting.
“We need to raise the rate of Newstart and Youth Allowance so that there is a reasonable expectation that people can maintain housing while on income support. We support the national campaign that calls on the Federal Government to raise the single rate of Newstart, Youth Allowance and related payments.
“Over 800,000 people, including parents, carers, people with disability, other people locked out of paid work and students are struggling daily to afford basic essentials like a roof over their head and food on their table. Most single people on Newstart without children live on $39 a day and are having to make tough choices between eating a meal, maintaining heating and keeping a roof over their heads,” Ms Helyar said.