Worrying new research reveals that only three postcodes in regional Victoria are affordable to the state’s most vulnerable renters.
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Rural Victoria was once perceived as a backup for tenants priced out of Melbourne, but new research reveals that this perceived affordability may be a relic of the past.
The latest Rental Affordability Index by National Shelter and SGS Economics & Planning revealed that rental unaffordability has become an epidemic in both regional and metropolitan Victoria.
“There are only three postcodes where the average household can get a rental that costs less than 15 per cent of total income, and these are not areas with significant job opportunities or other supports to lift people out of poverty,” revealed Emma Greenhalgh, CEO of National Shelter.
For those on low incomes, the situation is far more dire. Julie Ware, chief of services at Brotherhood of St Laurence, warned: “The rental crisis means there is virtually nowhere in regional Victoria that is genuinely affordable for people on low incomes and income support payments.”
Around the Surf Coast, in areas like Torquay and Barwon Heads, the average rental household is forced to spend over 38 per cent of their income on rent.
“It is wrong that those who are already facing significant poverty and barriers to work are left to pay the price for this unacceptable market failure,” stated Ms Ware.
Concerningly, this rampant unaffordability is not just harming people; it’s hurting the Victorian economy as well, as key workers are increasingly struggling to find housing near to their workplaces.
“Nursing homes are struggling to find nurses, schools to find teachers, and the building sector to find builders to build houses,” reported SGS Economics & Planning principal Ellen Witte.
In Melbourne, affordable rentals are even scarcer. While the average rental property costs 24 per cent of the average household’s income, those on low incomes have far fewer viable options.
“The rental market is fundamentally broken,” stated Ms Greenhalgh. “In Melbourne, students and people in lower incomes are priced out of entire swathes of the city.”
“Melbourne’s rental market is in a crisis and it’s only getting worse,” she said.
Since the mid-2022, rental affordability in Melbourne has dropped, fuelled by a 16 per cent rise in rents and rapid price rebounds in apartments.
According to the research, previously affordable areas like Docklands, Southbank, Footscray and Meadow Heights have become out of reach to those who are struggling. The average renter must now travel at least 15 kilometres away from the central business district in order to find affordable rental accommodation.
“The private rental market is failing people on low incomes, and we cannot afford to simply tinker around the edges of reform,” Ms Ware concluded.
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