DOUBLE VISION: Snapshot shows power of rate rise
UNLIKE previous years, the impact higher Centrelink payments have on rental affordability can be measured in real terms.
Anglicare has conducted its Rental Affordability Snapshot for a decade and this year’s study is like no other as the organisation factors in temporary increases in Centrelink payments.
The payments, introduced by the Federal Government in March, were brought in just days after Anglicare conducted the study which examined the number of affordable rentals for people on low incomes on the weekend of March 21.
Anglicare found 955 listings over the entire North Coast – from Port Macquarie to Tweed Heads – and then used that list to analyse the impact increased payments would have on affordability.
Ordinarily there would have been just 19 suitable rentals for any one household relying solely on income support payments.
However, that figure jumped to 122 when the new coronavirus supplement was factored in, representing an 8 per cent increase in affordability for an out-of-work couple with two children.
There were 229 homes suitable for households with at least one person earning the minimum wage.
Anglicare North Coast’s interim CEO Leon Ankersmit said the increased payments – which do not apply to those on the age pension – should be open to everyone on government assistance and should be permanent.
“Welfare increases have given some people badly needed relief, but the market is still failing people on the lowest incomes,” Dr Ankersmit said.
“Our Snapshot shows that a person who is out of work can afford less than two per cent of rentals – and that’s with their payments doubled.”
Mr Ankersmit said more needed to be done to support people on the lowest incomes, including investing in affordable housing.
“We’re asking people to stay at home – so we must invest in homes for people who need them most. Nobody should be squeezed out of the market during a health emergency,” he said.
“Our shortfall is massive. Investing in housing would be the most powerful way to tackle the rental crisis – and boost our regional economy.”
However, Master Builders Australia recently conducted modelling which showed up to 43,000 new homes would not be built in the next 12 months as a result of coronavirus.
CEO Denita Wawn said the lockdown was having a “devastating impact” on the building industry and MBA had revised their industry forecast published back in February.
“While we obviously did not expect good news, the scope and depth of the potential damage to our industry and the economy is devastating,” she said.
“There is already a current shortfall in achieving the required target of 200,000 homes a year which means that the impact on housing needs of our community will be severe.
“We previously forecast that there would be around 159,000 new housing commencements in 2020/21. We now expect there to be only around 116,000, a drop of 27 per cent.”
Ms Wawn said the forecast showed more stimulus measures could not wait and if the Government did not act now “the battle against the Covid-19 economic emergency could be lost just as the battle against the health emergency is starting to be won”.
According to the RAS national report rent should be no more than 30 per cent of a household budget “to avoid financial stress and difficult choices” and Anglicare then take in several government payments to calculate affordability.
“This is an internationally accepted benchmark from years of study into living costs,” the report said.
“We use these figures to calculate the maximum affordable rent for each household type, and
compare that against listed properties that are suitable.”