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Advocates call for rental price cap

Advocates call for a rental price cap as government review fails to address affordability

Renter advocacy groups are calling for rent capping following concerns that the government’s review of the Residential Tenancies Act fails to address rental affordability.

SACOSS, Uniting Communities, Better Renting, and the Anti-Poverty Network SA all made submissions on the review discussion paper published by the Office of Consumer and Businesses Services, but have joined together to highlight the crisis in rental affordability and the need for the government to cap rental price increases.

Government data shows that some rents have gone up by nearly double the CPI rate over the last year. Median rents for a newly tenanted 2-bedroom unit in Adelaide in the September Quarter of 2022 were 12.1% higher than at the same time last year, while rents for 3-bedroom houses were 15.8% higher. By comparison, the general inflation rate for Adelaide was 8.4% for the year.

The call for a rent price cap comes just days after the Federal Government intervened in the energy market by imposing price caps on coal and gas.

There are a range of models for how rent capping can work, and the groups are happy to work with government on the details, but the first step is to urgently amend the legislation to enable rent price caps to be put in place.

Quotes attributable to the groups

SACOSS CEO, Ross Womersley, said

“It is disappointing that very few of the proposals put forward by the government deal with the fundamental issue of rental affordability. While many of the proposals in the government’s discussion paper would be of modest benefit to renters, including ending no cause evictions, they don’t go nearly far enough to address the current rental affordability crisis.”

"We know that when rents increase faster than inflation, landlords receive an increase in their real income, while tenants see their real standards of living decrease. This is simply unfair.”

Pas Forgione, Campaigns Coordinator for the Anti-Poverty Network SA said

“We are in a rental affordability crisis, and in a crisis, governments should take urgent action. We are seeing people skipping meals and medicines, because of huge rents and enormous rent rises. This cannot be allowed to continue. Governments have to intervene to protect people just trying to keep a roof over their head.”

“We have seen price controls applied to national energy markets, because electricity is an essential need, we need something similar for rent increases, because housing is an essential need, and rent rises are causing huge pain and stress to renters and their families.”

Better Renting Executive Director Joel Dignam said:

“Everyone should be able to afford to stay in their home. For people who rent to have stable and affordable homes, they can’t be facing rent increases that stretch household budgets to breaking point and force people to move. Capping rent increases is something the government can do right away to help keep rents affordable and support people to keep their homes.”

Uniting Communities CEO, Simon Schrapel, said

“When markets fail, our governments must find the courage to intervene. Our housing market – particularly for many South Australians relying on private rental housing – is in crisis. Now is the time for decisive intervention.”

 “A rent cap to protect the most vulnerable would have an immediate and profound impact in reducing the stress for low-income private renters. This is action that can – and must – be taken now if our State Government has a real commitment to reducing financial hardship and homelessness”.