Our Rental Affordability Snapshot shows that renting in the private market is just not affordable for people on government income support. To have a roof over their head, people on very low incomes are having to sacrifice other essentials. Sadly, this is no surprise to us. In the ten years that Anglicare Australia has been completing the Rental Affordability Snapshot, the results have not meaningfully changed.
» A crisis for the poorest in our community – with no end in sight
There are around 715,000 people on Newstart in Australia, more than 83,000 receiving Youth Allowance, and approximately 750,000 people receiving the Disability Support Pension. Many of them are likely to be renting. We also know that approximately many people receiving the Aged Pension rent their homes. With just 4% of rental properties on the private market affordable and suitable for people on the lowest incomes, the size of the crisis is clear.
96% of rentals are not affordable for people who receive income support
We know that many people on low incomes are avoiding becoming homeless by sacrificing other basic living needs to pay the rent – things like eating enough, using public transport, heating or cooling their home, or seeing a doctor when they need to. Many approach Anglicare agencies for help with emergency food relief, financial counselling and emergency assistance to pay essential bills such as electricity. However, for the poorest in our communities, there is a limit to the number of ways they can try and afford rent when their income is so little.
This is why the number of people who are homeless in Australia keeps going up. According to the Australian Bureau of Statistics, using Census figures, from 2011 to 2016, the number of homeless people in Australia rose from over 102,000 to over 116,000.
» Older people are doing it tough
The most generous of government benefits is the Age Pension. Yet for a couple on the pension, only three percent of rentals were affordable. Single pensioners have it even worse, with less than one percent of listings left to compete for.
A growing number of older Australians are on Newstart, including some 183,000 people over 50 who have been on Newstart for over a year. Research shows that this cohort might not ever return to the workforce. Our Snapshot paints a glum picture for them, with years of rental stress ahead of them before they retire onto the age pension.
Unfortunately, their story won’t end there. This year we had our worst result for people on the age pension – but perhaps that isn’t surprising. The pension was designed assuming that retirees own their own home and have no housing costs. But with home ownership going down, more and more pensioners are renting in retirement. And for many, that means they are retiring into poverty.
The insecurity facing older people should worry renters everywhere. It paints a bleak picture for their future.
» The minimum wage isn’t enough
A single person working full-time on the minimum wage will find that only 2% of rentals are affordable – an all-time low for our Snapshot. Of course, this Snapshot doesn’t tell the whole story. Although we look at the full-time minimum wage, we know that half of our workforce is now working casually. Over one million Australians are underemployed. Their plight is likely to be much worse than this Snapshot shows. Single people on the minimum wage with children for example will find that only 4% of rentals are affordable, even with the help of the Family Tax Benefit.
96% of rentals are not affordable for single parents earning minimum wage
The minimum wage has not kept pace with the rising cost of living – a failure of both the government and the market. It’s also important to remember that people on low incomes are not just competing with each other in the rental market. With one in three Australians renting, and with soaring housing costs, they are also competing with people on much higher incomes.