Sydney rental affordability hits record low

SKYROCKETING rents are forcing pensioners and working parents out of all metropolitan areas across the country.

Sydney rental affordability has hit a record low. Picture: Mick Tsikas/AAP

SKYROCKETING rents are forcing pensioners and working parents out of all metropolitan areas across the country, according to the latest Rental Affordability Index.

The study, conducted by SGS Economics & Planning for peak housing body National Shelter and Community Sector Banking, has revealed rental affordability dropped in all metro areas except Perth in the last quarter, with Sydney affordability hitting a record low.

“A fulltime teacher who is a single parent would be paying 43 to 55 per cent of the family’s income on rent in Greater Sydney,” said SGS partner Ellen Witte. “On top of rents, these families would be carrying high costs for childcare, education and after school care.”

The average household in Sydney is now paying 29 per cent of their income on rent, just under the definition of housing stress, which occurs when households spend 30 per cent or more of their income in rent.

“We conclude that now even the average income household in Sydney is facing housing stress — this means families are struggling to make ends meet and pay for other primary living needs such as food, energy, water, education, healthcare and transport,” said Ms Witte.

The least affordable suburbs in Sydney are Elizabeth Bay, Rushcutters Bay, Potts Point, Woolloomooloo, Double Bay, Milsons Point, Kirribilli, Darling Point, Point Piper, Edgecliff and Woollahra, where the average renting household would have to pay up to 86 per cent of their income. Affordable rents are available further from the city in suburbs such as Blacktown and Cabramatta.

“Rents are most affordable in places where the least opportunities are in terms of jobs, services and education,” Ms Witte said.

For a single pensioner, renting a one-bedroom unit anywhere in Sydney would cost 60 per cent of their pension, the study found. Most rentals for older people on low to moderate incomes were deemed “severely” or “extremely” unaffordable.

“For a pensioner couple the news is not much better in our metropolitan centres, with most households having to spend between 38 and 68 per cent of their income on rent,” said Ian Yates, chief executive of seniors peak body COTA.

“This has a huge impact on the quality of life of older Australians in the rental market. Too often we hear stories of age pensioners who are left to choose between using the last of their income to buy food or medication once they have met their obligations for rent and utilities.”

COTA said an increasing number of age pensioners have to move away from their family and support networks to keep a roof over their heads.

“This is especially concerning for older working women who are reaching retirement and have not been able to build up their superannuation — these people have nowhere to go,” said National Shelter executive officer Adrian Pisarski. “On top of that, living further out of the city poses extra challenges such as poorer access to transport, services and health care.”

Mr Pisarski said while the Federal Budget had introduced some welcome measures, house price inflation was locking people out of ownership and putting greater pressure on rental markets, forcing out people on low incomes.

Community Sector Banking CEO Andrew Cairns described the latest Index as a “wake-up call”. “Without swift co-ordinated action to tackle housing affordability, Australia will become a divided country, with pensioners, working parents and low income groups locked out of living in metropolitan areas,” he said.