Rent stress hits home for many residents


NO neighbourhood in Melbourne or regional cities is affordable for a single person on Centrelink, single pensioner, or single parent on a low part-time income, Council to Homeless Persons CEO Jenny Smith has said.

The latest Rental Affordability Index shows that households earning $50,000 a year and looking for a two-bedroom rental must move out at least 115 kilometres to escape “unaffordable” rent. This is defined as paying more than 30 per cent of income on rent.

This unaffordability extends to Frankston and the Mornington Peninsula, where rental affordability has declined to such an extent that it is either “extremely” or “severely” unaffordable for single pensioners.

They would be forced to pay 65 per cent of their income to rent a one-bedroom flat in Frankston and 45 per cent on the Mornington Peninsula.

Low-income earners paying more than 30 per cent of their income on rent are regarded as being in rent stress – a confronting issue on the Mornington Peninsula which has the second highest rate of elderly residents in the state.

The dire situation has prompted the Council to Homeless Persons to call for 14,500 new social housing properties state-wide, with “at least 1800 in the Frankston and Mornington Peninsula in order to house the families currently on the waiting list”, Ms Smith said.

In Frankston, a single part-time worker on parent benefits looking to rent a two-bedroom house would be paying 45 per cent of their income (severely unaffordable); a $70,000 per annum household would be paying 38-60 per cent of their income, and a single person on Newstart would be paying 69 per cent of their income for a one-bedroom flat.

On the Mornington Peninsula, a pensioner couple would be paying 36 per cent of their income for a one-bedroom dwelling, and a single person on Newstart would be paying 69 per cent of their income for the same dwelling.

“This is a problem that needs both state and federal governments to pull together to fully resolve – and the federal government is currently asleep at the housing affordability wheel,” Ms Smith said.

“In their next budget, we are calling on the Victorian Government to step in and accelerate its social housing program.

“Private rental is now out of reach of low-income residents and more and more are living on the precipice. They are spending so much on housing that they cannot afford other essentials, including food and medication.

“The good news is that the state government can afford to pay more for public housing with tax revenue from stamp duty nearly doubling over the past five years to $6.2 billion a year,” Ms Smith said.

“The windfall gains to the budget from skyrocketing house prices should be used to mitigate the pain that the housing crisis has caused. The maths are pretty simple.”

She said a “dark flipside” to economic growth was fierce competition for rental properties with those able to afford them “crowding out those left behind with homelessness as a consequence”.

First published in the Frankston Times – 11 December 2017

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