Australia’s rental crisis to worsen with 6600 affordable homes lost

The rental crisis has seen people living in cars with warnings more Aussies could be pushed into homelessness. And now things are set to get worse.

The rental market is set to get even worse as 6600 homes leave an affordable rental scheme. Picture: NCA NewsWire/Gaye Gerard

Australians are already being hit with unsustainable rent increases and a lack of homes on the market, but there are warnings the rental crisis is set to deepen as 6600 homes across the country will no longer be part of a rental affordability scheme.

There are fears more Aussies could be pushed into homelessness as the availability of private rentals remains low and waiting times for social housing stretches into the years, according to housing campaigners.

The national rental vacancy rate remains at a record low – below 1 per cent – while campaign group Everybody’s Home spokeswoman Maiy Azize said Australia still needed half a million social houses immediately.

“It is the least affordable we’ve ever seen it: The rental market is at fever pitch and the social housing shortfall is growing all the time,” she told the Sydney Morning Herald.

“We’ve heard stories about people living in their cars for months at a time while they try and find a place that’s affordable. So this is absolutely a problem that’s getting worse, and the unavailability of social homes and the enormous waiting list is playing into it.”

Things are set to get worse for renters in Australia as 6600 homes are set to leave an affordable rental scheme this year. Picture: NCA NewsWire/Gaye Gerard

Yet, 6600 affordable homes are set to be removed from the National Rental Affordability Scheme, which was introduced by the Labor government in 2008, including nearly 2500 from Queensland alone.

Other states to lose homes from the scheme include 1350 in Victoria, 1100 from Western Australia, while NSW will see 605 properties gone.

The scheme gave property owners a subsidy of nearly $11,000 each year for 10 years if they rented out newly built dwellings at 20 per cent less than the market rate.

However, it was axed by the Coalition government in 2014 and will no longer operate from 2026, with a further 9200 to leave the scheme in 2024.

The rental crisis is leading to a social disconnect and financial struggles for many Australians, according to National Shelter CEO Emma Greenhalgh. Picture: NCA NewsWire/Gary Ramage

A rental affordability report released last year revealed 40 per cent of low-income households are experiencing rental stress, and are struggling to pay for food, heating and healthcare.

The rental affordability index, from SGS Economics and National Shelter, revealed that housing stress is battering regional Australia, alongside capital cities with “unsustainable” rent rises far outpacing wages.

National Shelter CEO Emma Greenhalgh said the nation’s social and economic wellbeing is at risk, with housing stress and homelessness increasing as the nation experiences a lack of affordable housing options.

“Rental increases mean individuals and families are forced to move away from family and friends driving disconnection at the same time they are struggling to find money to pay for essentials like food, utilities and healthcare.

“Key workers, including nurses and teachers often can’t afford to live in the communities they serve.”

The Federal Government will introduce it $10 billion Housing Australia Future Fund scheme this year, which will be used to build 30,000 new social and affordable homes in the fund’s first five years. However campaigners have argued this falls far short of what is needed.