A single pensioner can now only afford 0.8 per cent of rentals across Australia according to research by Anglicare Australia. Disability Support Pensioners are even worse off, only being able to afford 0.3 per cent of rentals.
The findings of this report offer a stark contrast to the current commentary on rental affordability. Commentators have been saying average rents are coming down, which they claim is proof the market is correcting itself. Although average rents are coming down, this is caused by cuts to medium and high rent with next to no change in what passes for “low” rents.
To make matters worse for low-income renters, bans on evictions are soon coming to an end. Until 15 October renting households in NSW in financial hardship due to COVID-19 cannot be evicted for falling behind on rent. Renters have been able to defer paying rents which has left renters accruing a rental debt. However, if renters are unable to pay their rent plus any unpaid rent accumulated during the ban by 15 October, landlords are within their rights to evict tenants.
Renters currently on JobSeeker are particularly at risk as the JobSeeker payment will be reduced by $300 a fortnight on 25 September and is scheduled to be reduced by a further $250 to return to its pre-COVID rate on 1 January 2021.
Right now, people receiving the increased JobSeeker rate can afford 1 per cent of rentals. This will decrease to 0.2 per cent on 25 September, and when JobSeeker is reduced again on 1 January 2021, recipients would be able to afford just 13 rental properties on the market now. That’s 0.01 per cent of available rentals.
As of July 2020, almost 1.5 million people were recorded as recipients of JobSeeker. This means in 2021 when JobSeeker returns to its pre-COVID rate, there will be 1.5 million people living in financial stress and many people may become homeless.
There must be immediate government assistance to create more affordable homes, and income support payments must offer more support, so that people on low incomes can rent a roof over their heads.
