New data shows rental affordability has hit record lows in nearly every major capital. The annual rental affordability index released by SGS Economics and Planning, and National Shelter, confirms low-income earners are bearing the brunt of soaring rents. It also reveals Perth now has overtaken Sydney as the least affordable city to rent in Australia.
Category
📺
TVTranscript
00:00Yeah, it's really deteriorated a lot.
00:05So we've been delivering the Rental Affordability Index for 10 years now, and it's never been
00:09this bad.
00:11So the index has now two capital cities where even the average income household is paying
00:17more than 30% of the household income on rent.
00:21And mind you, those are households that earn like $120,000 to $130,000 per annum.
00:27So those are well-established households where people get quite a good income.
00:33So that just paints the picture of how dire the situation would be for the much lower
00:37income households, where the situation is quite drastic now.
00:42So it's whenever households are paying more than 30% of their rent, we are basically saying
00:46they're in housing stress.
00:48So that means there's insufficient money left for other primary needs, such as food, transport,
00:55cooling or heating of the house, education and medical needs as well.
01:00So it's really quite a big problem.
01:02And of course, it flows through to the children as well, and you might even have intergenerational
01:08issues as a result.
01:09While in the past, affordability was mainly an issue in the capital cities, we saw the
01:15affordability really spread like an oil stain, and entire areas in our interactive maps showing
01:22up as quite deep red.
01:23But if you look further into the data, there are now whole suburbs where lower income households
01:29would be paying 75% of their income or more on rent, and that's just undoable.
01:35So that results in entire cohorts being pushed out of the market, living in overcrowded housing
01:41or other unsuitable ways of living.
01:45And also in the past, perhaps it was sometimes said, oh, maybe if you can't afford it here,
01:50maybe just move a suburb down over.
01:53But it's spread now so far, everything is unaffordable.
01:56And since COVID, even the regions are unaffordable.
01:59So now it's a national problem and households have nowhere to go.
02:03So affordability dropped by 13% in one year.
02:07So we looked a bit more into the data of what was going on there.
02:11Just like any other capital city, there are high construction costs and material costs,
02:16but that's affecting everyone.
02:18And as a result, of course, less housing coming online, but also with that continued population
02:25growth and of all the states and territories in Australia, Western Australia actually has
02:31the highest level of investment, a share of the regional economy.
02:36And that's especially investment in engineering and any sorts of industries that are supporting
02:42the resources industry.