SBS News,
6 May 2024:
The
median rent across the nation is $627 a week, ranging from $547 in
Hobart to $770 in Sydney, according to property data provider
CoreLogic.
The
regional median was $540, driven by rises in house rents in regional
Queensland and Tasmania.
Rents
are going up faster in areas between 30 and 40km from city centres,
CoreLogic head of research Eliza Owen reported.
"Part
of the reason for the re-acceleration in rents nationally could be
due to renters being forced into more affordable, peripheral housing
markets as they become priced out of more desirable and central
metropolitan locations," she said.
But
supply and demand pressures remain high across the nation and
migration levels implied there were at least 200,000 new households
in Australia, while only 173,000 new dwellings were completed to
September last year, Owen said....
Median
rents were more than $1,000 in nine areas, with adjoining
Cottesloe-Claremont suburbs in beachside Perth the only area outside
Sydney to command four figures.
Rents
in Pittwater, almost 25km from the CBD on Sydney's northern beaches,
were the highest at $1,335 per week, coming down half a percentage
point since a peak in March.
Rents
were still up 8.4 per cent annually in Pittwater, in line with the
8.5 per cent national increase.
The
data comes after the National Housing Supply and Affordability
Council launched its inaugural report on Friday, painting a dire
portrait of Australia's housing system.....
National
Housing Suppply and Affordibility Council,
State
of the Housing System 2024,
3 May 2024:
Forward
There
is no denying the housing crisis we are in. It is a longstanding
crisis, fundamentally driven by the failure to deliver enough housing
of all types – from social housing through to market home
ownership. At its heart, this crisis is about insufficient supply,
but many contributing factors are making it more acute – the
resumption of migration at pace, rising interest rates, skills
shortages, elevated construction company insolvencies, weak consumer
confidence and cost inflation to name just a few. These all combine
to create an environment in which prices and rents are growing faster
than wages, rental vacancies are near all-time lows, 169,000
households are on public housing waiting
lists, 122,000 people are experiencing homelessness and projected
housing supply is very low.
Australia’s
housing market is far from healthy. An unhealthy market has periods
of rampant price growth,
is unable to produce enough supply to meet demand, is overly reliant
on an unsupported private market to address most of Australia’s
shelter needs, creates scarcity and cannot match the rich expanse of
demand with a breadth of housing choice.....
Executive
Summary
Housing
affordability worsened in 2023, from
already
challenging levels
Housing
affordability worsened in 2023. The worsening was widespread,
occurring across states and territories, cities and regions, income
levels, age groups and tenure types.
Housing
affordability deteriorated significantly for mortgage holders.
Mortgage interest rates rose by an
average of 125 basis points in 2023, and the average mortgage for
owner-occupiers reached $624,000. Since the first increase in the
Reserve Bank of Australia cash rate in May 2022, minimum scheduled
repayments for borrowers have increased by as much as 60 per cent.
Aspiring
homeowners experienced a decline in their ability to purchase a home.
It takes the average prospective
homeowner around 10 years to save a 20 per cent deposit for an
average dwelling. Even with
a deposit, only 13 per cent of the homes sold in 2022–23 were
affordable for a median income household.
Renters
in the private market experienced a sharp rise in rents. Advertised
rents increased by 8 per cent in 2023 and have increased by around 35
per cent since the start of the decade. Finding a rental property is
increasingly difficult. Nationally, the rental vacancy rate is 1.6
per cent – around its lowest level on record and well below the
rate considered to reflect a balanced rental market of around 3–4
per cent. In some parts of the country, including some capital
cities, it is as low as 0.5
per cent.
Worsening
affordability placed additional pressure on demand for non-market
housing. The number of ‘greatest needs’ households on public
housing waiting lists rose by 2.4 per cent in the 2022–23 financial
year. Waiting lists for First Nations housing rose by 10 per cent.
Service providers reported a rise in demand for homelessness services
and crisis accommodation.
Many
households have made difficult trade-offs in the face of rising
housing costs, including reducing spending
on other essential household items; living further away from places
of employment, education, and social and family networks; or living
in overcrowded dwellings or in housing with inadequate or expensive
heating or cooling options.
Worsening
affordability is particularly problematic for vulnerable groups,
including low-income households, single parents, young people, single
pensioners, those fleeing domestic or family violence, people with
disability, and First Nations Australians. Declining rental
affordability correlates with an increase in homelessness.
Worsening
affordability is contributing to poorer housing outcomes for First
Nations Australians. First Nations
households are half as likely to own their home, 6-times more likely
to live in social housing, 3-times
more likely to live in overcrowded dwellings and almost 9-times more
likely to experience homelessness
compared to non-Indigenous Australians. These poor housing outcomes
impact on health
and wellbeing, access to education and employment, and connection to
community. Without targeted
measures, undertaken in partnership with First Nations people,
housing outcomes under the National Agreement on Closing the Gap are
unlikely to be met.
This
report tells us that:
More
than 30 per cent of Australians rent their home. The number of
renters is increasing, and those who
are renting are doing so for longer. Renting is the only viable
tenure option for an increasing share of the population. Australia’s
rental system provides only limited tenure security and other rights
to renters. Australia needs regulatory frameworks that support
tenants’ rights and address the need for better tenure security.
More institutional investment in rental housing could provide tenants
with more rental options and add to the dwelling supply.....
The
evidence base indicates that Australia’s tax framework influences
the housing system in ways that
have implications for supply and affordability. Tax arrangements
could potentially be better calibrated to support housing supply and
affordability outcomes. Australia’s tax system also favours home
ownership over other forms of housing tenure, which can widen
inequality between those who can and cannot access homeownership. A
gradual transition to a more consistent taxation system across tenure
types may contribute to a more equitable housing system.
Non-market
housing, such as social housing and affordable housing, is essential
infrastructure. It reduces
homelessness and the incidence of poverty, supports economic
productivity and labour market
participation, and fosters more cohesive and sustainable communities.
In some remote areas of
Australia, social housing is the main form of available rental
accommodation. There are federal, state
and territory policies that will support the delivery of more
non-market housing over the National Housing Accord period. However,
levels of non-market housing are forecast to remain low relative to
history and in comparison to other advanced economies, and lower than
demand....
Supply
of social housing
Australia’s
social housing supply has fallen short of demand (Van den Nouwelant,
et al., 2022). From the
1940s to the 1980s, government housing agencies built large volumes
of new public housing (Chart 2.12). Instead of focusing mainly on the
direct provision of non-market housing, governments have shifted
towards a model of providing rent assistance payments to enable more
households to rent in the private market. The provision of social
housing is now primarily focused on supporting people in greatest
need.
The
number of non-market dwellings has stagnated as a result. This has
contributed to a one-third decline
in social housing as a share of the housing stock, from a peak of 5.6
per cent in 1991 to 3.8
per cent in 2021 (Chart 2.13). This indicates a reduction in the availability of adequate housing for lower-income
and disadvantaged households. However, recent policy measures, such
as the Housing Australia
Future Fund and new public housing commitments by state and territory
governments, mean
that a rise in the current levels of investment in non-market housing
is expected in coming years....
The
report also draws attention to the following:
Box
2.1: Climate-related disasters
The
housing system is inflexible when responding to natural disasters.
The increased frequency and severity of natural disasters are adding
to the demand for new houses to be built and for repairs on existing
housing, often in higher-cost locations such as regional and remote
areas. Rental markets are also affected when homeowners are forced to
rent accommodation while their homes are repaired. Regional New South
Wales was severely affected by its worst recorded flood in February
2022. In Lismore, 89 per cent of housing stock was severely impacted
and 3 per cent was destroyed (Lismore City Council, 2022). Over the
quarter to March 2022, house rents in Lismore increased 22 per cent
to $550 a week. This almost matched the level of Sydney house rents,
which were $600 in the same quarter (Domain, 2022). The supply
response following natural disasters is slow due to the time taken to
process insurance claims and increases in demand for labour and
materials, leaving many residents without appropriate housing,
sometimes for years after the event. The rebuilding following the
Kimberley floods in Western Australia was significantly delayed due
to its remote location and the pre-existing statewide shortage of
tradespeople, which left people living in temporary shelters months
after the floods (ABC News, 2023b). The impact of natural disasters
has a lasting effect on housing in affected areas; for example, in
the form of lower house prices due to a heightened risk of a natural
disaster re-occurring. After 2017 floods in Lismore, property values
normalised in 6 months. However, by March 2023, a year after the
floods in the Northern Rivers, house prices in the most affected
suburbs had fallen by 22–30 per cent – more than the regional
average of 19 per cent (CoreLogic, 2023). The increasing severity and
frequency of natural disasters could produce larger and
longer-lasting effects on the housing system. [my yellow highlighting]
At Page 151 of this report is this section: 8.1 The Council has identified 10 areas of focus for
improving housing system outcomes.
Read it for the record but don't raise your hopes.
This
comprehensive and at times overly optimistic report can be found at:
https://nhsac.gov.au/sites/nhsac.gov.au/files/2024-05/state-of-the-housing-system-2024.pdf
