Owning a home in Australia has remained a dream for many. The reason why renting has become a popular option. Unfortunately, renting has also become unaffordable these days to many Australians.
Latest research showed that renters particularly those in the inner suburbs of Melbourne, Sydney and Brisbane are spending more than 30 percent of their average wage on rent alone. This puts them in a condition known as housing stress, according to The Australian Housing Income Gap Report. The report compiled by Compass Housing Services found that in order to rent a three-bedroom house in an inner suburb such as Brighton, the average Melburnian needs to earn $968 more each week or $50,336 more per year. He or she needs to earn an average of $130,000 per year so as not to be considered under housing stress.
The situation is worse in Sydney. Sydneysiders who rent, for example need to earn an extra $1,503 per week or $78,139 per year. These rental rates are considered unaffordable particularly for middle-income earners including nurses, teachers, accountants, HR professionals and journalists.
With this situation, many tenants are now forced to live away from the city center instead of renting close to their workplace and schools. If they choose to live near the CBD, they more affordable option is to rent a one-bedroom apartment.
The report noted that this rental situation has a real impact on living standards. This is because those experiencing housing stress are normally having difficulty paying for their basic needs such as food, utilities, healthcare, childcare, insurance and debt repayments.
Compass Housing, the organization which conducted the research, has suggested several actions to improve the housing market across Australia. These strategies include the building of 500,000 social and affordable housing in the next 10 years; a review of the tax and transfer system to achieve a fairer balance between the level of support provided to investors, first-home buyers and renters;
reforms to tenancy laws in every state (such as those pending in Victoria) for greater security of tenure for renters and decrease demand for social housing.
Currently, the suburbs of Melton, Dandenong and St Albans are the most affordable for renters in Melbourne. The least affordable are Brighton, Port Melbourne and Mornington.
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By Wendy Chamberlain
Copyright 2018 | All Rights Reserved
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With a passion for all things real estate spanning over 20 years, Wendy loves that her role as a Buyers Agent or Sellers Advocate gives her buying and selling clients an experienced voice they can trust when it comes to negotiating to buy or sell something as important as their home or investment. Wendy considers it a privilege to be asked to help others realise such an important goal as home ownership and to be trusted with that honour. Get in touch today via www.wendychamberlain.com.au for a no obligation chat about how Wendy can work with you and help you save time and money to secure your new home sooner.