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Low-income renters need State Government help now

OPINION PIECE: Analysis shows Adelaide rents – even in the cheapest suburbs – are unaffordable for low-income earners. Ross Womersley calls for urgent State Government action before COVID rental support comes to an end this year.

Apart from being our Labour Day holiday, Monday was also International Tenants Day, designated by the International Union of Tenants in 1986.

Unfortunately, it’s not a day when tenants receive flowers, chocolates or other gifts, but it is important because more than one in four South Australian households today are renters. And on average, they have lower incomes and proportionately higher housing costs than home-owners (even those paying mortgages).

Renters really are at the pointy end of our housing affordability struggles in SA. It could get worse as COVID rental support measures come to an end in December. And even more so as the National Rental Affordability Scheme winds down and renters in housing through this scheme lose subsidies.

Using State Government data, the South Australian Council of Social Service has calculated that the average asking rent for a two-bedroom unit in the cheapest Adelaide suburbs in June was $293 per week. It was $385 for a three-bedroom house.

For anyone on a low income, these rents are simply unaffordable.

At those prices, rent would account for 76 per cent of the weekly income of a single person on the JobSeeker unemployment payment, 54 per cent of the aged pension for a single person, and 40 per cent for someone on the minimum wage – and much more for those precariously employed or with less than full-time hours.

Tenants can face crippling energy costs because rental properties are not energy efficient, and renters are rarely able to persuade landlords to install energy-saving technologies like solar power, double glazing or insulation.

It’s hard to make ends meet and afford all the other basics if so much of your weekly income goes on rent, and your energy bill is out of control. We know that for some, this means going without food, medicine or social interactions – all of which creates long term health costs for those in rental stress.

But it doesn’t have to be this way.

While most income and housing market levers are in the hands of the Federal Government, the State Government can intervene to make renting more affordable. Making big investments that increase public housing stock would create homes for people who are struggling the most, while also rebuilding our economy and taking pressure off rental prices for everyone.

Similarly, by government mandating disclosure of housing energy efficiency ratings, tenants would understand the potentially hidden costs of renting properties, while establishing minimum energy efficiency standards would ensure that renters aren’t just leaking money through the roof or gaps in walls.

This week’s holiday to celebrate the eight-hour day reminds us that governments can intervene in markets to support people and set basic minimum standards. It is a choice and an approach that should be applied now in South Australia’s rental market.

Ross Womersley is CEO of the South Australian Council of Social Service. This opinion piece was published in Indaily on 8 October 2021.