Anglicare's Rental Affordability Snapshot 2014

Anglicare's Rental Affordability Snapshot for 2014 is out today. It looks at the 62 862 rental properties across Australia advertised to let on a typical Saturday last month, and considers whether the rents are affordable for low-income households (that is, rent's not more than 30 per cent of income). The picture is grim.

Some 'highlights':

• for single persons on Youth Allowance, just six properties (0.0001 per cent – let's call it zero) were affordable;
• for single persons on Newstart, just 25 properties (0.0004 per cent – let's call it zero) were affordable;
• for single persons on the Disability Support Pension, just 316 properties (0.5 per cent) were affordable;
• for single Age Pensioners, just 625 properties (one per cent) were affordable;
• for single parents with two kids (on Parenting Payment Single), just 533 properties (0.8 per cent) were affordable;
• for a couple with two kids (on Newstart), just 883 properties (1.4 per cent) were affordable.

It's bleak for low-income workers too:

• for single persons on the minimum wage, just 2 545 properties (four per cent) were affordable;
• for a single parent with two kids, on the minimum wage and receiving Family Tax Benefits, just 1 992 properties (3.2 per cent) were affordable;
• for a couple with two kids, on the minimum wage and FTB, just 7 639 properties (12.2 per cent) were affordable. 

This is the real housing supply problem in Australia: the lack of affordable rental for people on low incomes.

This is what happens when speculation takes over the housing market: the shape of the rental market is distorted. Higher-income households are priced out of owner-occupation and into competition with low-income households for rental properties; and higher-value (and hence higher rent) properties are brought into the rental sector by speculator landlords, while low-value (and hence more affordably rented) properties are allowed to pass out of the sector.

And this is what happens when governments positively encourage housing speculation: by not taxing housing held by owner-occupiers; by not taxing negatively geared landlords for income spent on financing their speculation; and by only half taxing speculative windfalls relative to earned incomes.