10 Jan 2020

Adelaide overtakes Sydney as the second-most-unaffordable capital city for renters in Australia

Adelaide is now the second-most-unaffordable capital city in the country for rental affordability, with experts pinning the blame on slow income growth and cost of living.

The latest report into rental markets across the country has shown Hobart is still the most unaffordable capital city to live in, however, Adelaide has leapfrogged Sydney into second spot on the national Rental Affordability Index (RAI).

Brisbane was next on the list in fourth position, followed by Melbourne, the ACT and Perth.

"In Hobart, we've got a wicked combination where incomes are stagnant but rents have been rising at 10 per cent a year for the last three years," National Shelter executive officer Adrian Pisarski said.

"Adelaide becoming the second-most-unaffordable place to rent is largely due to rising rents and incomes not rising in the same way they've been rising in Sydney."

Regional South Australia is still the most affordable place to rent in the state, but even there, someone on the Newstart allowance cannot afford to lease a single property.

The figures show there is not one place in Australia where a Newstart recipient can rent easily.

"Whilst we've got an average score of rental affordability across the nation, the average is masking a deteriorating situation for low-income households. On average, Sydney's improved slightly," Mr Pisarski said.

"Perth has improved slightly. Brisbane has improved slightly, where Adelaide and Hobart have deteriorated."

The Rental Affordability Index (RAI) is an indicator of the price of rents nationwide relative to household incomes based on new rental agreements.

According to National Shelter — which released the report — there is also a drop-off in home ownership among people entering retirement.

Women over 50 are one of the highest groups at risk.

Mr Pisarski is calling on the Federal Government to address the issue and provide more funding for low-income housing.

"We really think there needs to be a national housing strategy to look at investing in affordable housing," he said.

"There really has been a neglect of housing policy in Australia going back 20 years and it'll take us quite a long time to rectify it.

"Even a couple who are both on the pension but earning a little bit of extra money, as many pensioners do, will struggle to find anywhere to rent affordably in Australia.

"This has really serious implications for our retirement incomes policy going forward."

Poverty a reality for low-income earners

Social services advocates say some low-income earners and welfare recipients are being forced to choose between rent and necessities like food or medication.

Tracey Smallwood says she has $6 per fortnight to live on after she has paid for her rent in a share house, utility bills and food.

She has finished her Masters in Forensic Psychology and has worked as a youth worker.

Ms Smallwood now volunteers as the national advocacy coordinator at Australia's Unemployed Workers Union (AUWU), where she has also worked on the hotline.

"I'm lucky. I live with a good friend of mine whose sister and brother-in-law own the property," she said.

"The shopping centre is down the road and I live across the road from the train station. I'm lucky compared to a lot of other people.

"Being on the hotline listening to people, thinking I'm having a rough day, and then realising there are people out there that are dying.

"People that have to work out if they buy food this fortnight, they can't afford their medications. And it's a reality."

Ms Smallwood said while she was one of the lucky ones, others were being pushed into homelessness because they could not pay their rent.

"It's just to the point where people can't afford to live," she said.

"If they afford the rent they can't afford electricity, they can't afford food, they can't afford medication and it's also pushing them into homelessness.

She said she believed the Federal Government needed to do more.

"Speaking to people on the street, I was asking this young man how many pay cheques are you away from being homeless and he's working full-time, but still not getting that much money, and he said being realistic he's two pay cheques away," she said.

"Youth homelessness is the highest it has ever been and the Government just throws money at different programs, they need the people on the ground to work those programs and do them properly."

Adelaide is not a cheap place to live

When the RAI was launched five years ago it was unaffordable to live in Adelaide's inner city, but since then the problem has moved from those areas through to the north, south and into the hills area.

All of those areas are now rated as unaffordable, something that did not shock Ross Womersley, the chief executive of the South Australian Council of Social Services (SACOSS).

"I imagine most of South Australia is surprised because we generally tend to think of Adelaide being a very affordable place to live," he said.

"We imagine that the cost of living, particularly the cost of housing is cheap, relative to those other eastern seaboard cities.

"And so as a result, we sometimes imagine that South Australia must be a really cheap place to be. The reality, as these figures illustrate, is that it's simply not."

He said even though regional South Australia is ranked as the most affordable place to live, low-income earners looking to move from the city might not find it to be a cheaper option.

"We do know that some people leave metropolitan Adelaide deliberately thinking they'll be able to get cheaper housing in the regions," he said.

"Even if they're lucky enough to get cheaper housing, the opportunities for them to find work may actually be substantially less."

SACOSS has joined National Shelter in calling for governments at a state and federal level to make big investments in more affordable housing as well as raising Newstart and the pension.

"The great majority of homeless people are people who are living in their car, sometimes with their families in the car, living on other people's couches," Mr Womersley said.

"Sometimes people [are] in other people's garages, [in] other people's caravans, hoping that they might be able to find their way into something more permanent, more secure and safe.

"It's just a fundamental basic human right and we should be driving to make sure that everybody has access."

SOURCE ; https://www.abc.net.au/news/2019-11-27/adelaide-is-the-second-most-unaffordable-city-for-renters/11740484

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