News of rising rental yields for landlords isn’t so great for Australians doing it tough. Analysis from the Victorian Council of Social Services (VCOSS) show that rising rents, combined with stagnant wages, means lower-income Australians are being priced out of Victoria’s affordable housing.
According to the VCOSS analysis, Victorian rents have risen by 110% since 2001, while average wages increased by just 75% over the same period, and the basic Newstart allowance from Centrelink increased by only 50% over the same period.
VCOSS CEO, Emma King, said that renters are often the forgotten victims of a housing market in crisis:
“Increasingly, landlords are charging astronomical rents that people have little choice but to pay.”
“This is happening just as people are being shut out from home ownership and are renting for longer—including into retirement.”
This VCOSS analysis echoes several other recent studies of Victoria’s rents and housing market:
- Domain shows annual increases to Melbourne’s weekly rental rates of 5% for houses and 5.3% for units.
- SQM Research found that asking rents for Melbourne houses rose by 10.9% over the past 3 years, while asking rents for Melbourne units rose by 12.8% over the same period.
- SQM Research also found that Melbourne’s vacancy rate was just 1.5% in May 2017, down from 1.9% at the same time last year. This seven-year low is in despite of the supply of new apartment housing coming onto the market.
- The Real Estate Institute of Victoria found that it’s not just Melbourne experiencing high rents – regional Victoria is also seeing significantly higher rental yields for landlords.
Ms King said that the housing affordability crisis facing Victorian renters underlines the need for stronger renters’ rights in Victoria, including minimum property standards, increased privacy protections and banning ‘no reason’ evictions.