Tips to help you navigate the rental crisis
There’s no doubt that it’s tough out there for renters right now – and has been for a while.
If you’re trying to steer your way through Australia’s rental crisis, you’ll already know that you’re facing major competition, with not enough housing to go around, rising rents, and an industry that feels increasingly skewed in favour of landlords.
But knowledge is power and being aware of what’s causing the housing crisis in Australia, and the steps you can take to secure affordable housing is key. Here’s what you need to know.
Understanding the rental crisis – causes and impact
There are a number of reasons behind Australia’s rental crisis and experts say it’s been building for many years (which means it’ll probably take time to improve).
Firstly, housing is not keeping up with population growth. Nearly 1 million new households were formed between the 2016 and 2021 Census – but new dwellings are falling short.
Secondly, the increasing costs for materials, labour shortages and supply chain challenges hasn’t helped the housing supply, with a 2.7% reduction in new homes being built in Australia in June 2022 (compared to the previous quarter).
The result is high demand for rental properties, which has led to skyrocketing rental costs – especially in major cities. This makes it increasingly difficult for people to find stable and affordable housing.
On top of that, there’s less social housing (down from 4.9 per cent in 1981 to 3.8 per cent), which leaves renters on social housing waitlists for longer.
Landlords opting to rent out their investment properties as short-term stays to holiday makers has also affected housing supply in certain areas, such as the high demand inner city suburbs that tourists prefer.
The impact of all this has been a huge level of rental stress. Campaign group, Everybody’s Home, released a recent study – The Brutal Reality: The Human Cost of Australia’s Housing Crisis – which reveals that four out of five renters are spending more than 30 per cent of their income on housing, and 75 per cent of renters and mortgagees are worried about their financial security.
Researching and understanding the rental market
Some experts say the rental pressures and escalating rents may ease up in 2024. But what can you do in the meantime if you’re at the mercy of the market and looking for affordable housing? Here are our tips:
- Start researching the market: Even if you are happy with your housing, it’s still a good idea to be aware of what’s currently at play in the market, just in case your current situation changes and you have to start looking for a new rental sooner than you thought. Set up alerts on real estate websites and apps, and make a note of what’s available, where, and for how much.
- Build relationships with real estate agents: Drop in at real estate agencies for a chat to get a feel for what’s currently in market and to see if any new listings are coming up. Be friendly and exchange contact details, requesting that they get in touch should anything suitable come up. Be sure to ask questions at open houses to leave a lasting impression. In a market with so much competition, you’ll want to be remembered by decision makers.
- Tell everyone you know that you’re in the market for a rental: This means friends, family, and colleagues, who may hear of something before it’s advertised or be in a position to introduce you to landlords looking for new tenants.
- Create a renter’s resume: Just as you’d create an employment resume when job-hunting, it would pay to put together a renter’s resume that you can present to real estate agents and landlords. You can use a free design tool or a simple word document and include a photo of you and your family or whomever you’ll be renting with, details of your rental history, glowing references, and info about your employment and income. If you have a pet, include their details as well, such as their vaccination and microchipping status, and whether they are insured.
- Put your best foot forward: This means being the first person at the inspection. Dress to impress and be organised: have your bond sorted, prepare applications in advance, have references primed to take a phone call, and bring your renter’s resume. Submit applications immediately after leaving the inspection.
- Be flexible: This could look like staying longer on your current lease rather than battling it out in the volatile rental market; it might mean moving into a share house if it’s more readily available – or it may involve looking beyond your desired location to secure a rental property.
Negotiating rent lease and terms
In the highly competitive rental market, you’re probably wondering what kinds of things give you the edge over other renters when negotiating for a property.
Offering a longer lease may help get your application over the line as that can save the hassle for landlords who want a set-and-forget tenant.
What are the regulations in your state?
Australian rental laws and regulations differ across all the states and territories, so it’s worth taking the time to read up about your rights.
Renting and pets – what does this mean for you?
We love our furry friends – in fact, around two-thirds of Australians own pets. So where does that leave you as a renter? It’s something that many of us seeking affordable rental housing worry about.
Having a pet may make it harder for you to secure a property (sad but true). If you’re hoping to find a pet-friendly rental, do your research so you know your rights, as these can differ depending on the state or territory you reside in:
- In New South Wales, renters are not prohibited from keeping a pet or required to ask for their landlord’s consent, however a rental clause can include this restriction.
- Meanwhile in Victoria, Queensland and the Northern Territory, renters who want to have a pet on the property must ask their landlord for permission.
- This is a similar process for the Australian Capital Territory, though the landlord must submit an application to ACAT if they wish to refuse consent.
- In Western Australia and South Australia, a recent update in policies has meant landlords can only refuse consent for a tenant to keep a pet on reasonable grounds.
- Tasmanian tenants are also permitted to have pets at a property, but only if this has been agreed on by the owner or stated in the lease.
Maintaining financial peace of mind
Looking for a rental in a tricky market can have an impact on your finances, especially if you find a property that’s outside your budget.
Financial health check
Seek advice from a financial planner, who can help you figure out your needs, set achievable goals, and help you map out a plan going forward. They can also advise you on maintaining a good financial position, including having the right insurances in place.
While you’re refining your finances, now could be a good time to consider your life insurance needs and requirements. Talk to Guardian Insurance to learn more or request a life insurance quote online today.
12 Dec 2023