Low income renters hurt by high Sydney property prices
It’s no surprise to hear that land prices in Sydney have risen almost 11% in 2016, but it’s not just homebuying hopefuls being affected - low income renters are also feeling pressures from high property prices as demand for rental properties outstrips supply.
Steep housing prices is no new trend - Sydney lot prices have risen 65% over the past five years, according to afr.com. In the December 2016 quarter, residential land prices in Sydney jumped by 2.2% marking the tenth consecutive quarter of rising prices and the median lot price hit $455,000.
While Aussies looking to buy or build their own home are feeling the stress of price increases, renters - especially those on low incomes or social benefits - are also seeing the repercussions of these high land prices.
ABS figures show a rise in the amount of renters in Australia, from 18% of the population in 1994-95, up to 26% in 2013-14, and this increasing demand for rental properties is making it harder for low income families to find housing.
"People who can't afford to buy houses now are staying in the rental market," Sue King, Sydney advocacy and research manager for Anglicare told smh.com.au.
"That's creating a demand which is pushing up rental prices and squeezing out renters on lower incomes."
Anglicare's Rental Affordability Snapshot recently found that in 2017, rent in 7 out of 17 regions in the Sydney-Illawarra area is now too expensive for households on social welfare benefits. For people earning the minimum wage, just 15.4% of the 14,500 properties examined were suitable and affordable, down from 17.7% last year.
Industry and social service bodies are now pushing for the Government’s May Budget to tackle the issue of housing affordability in Australia, with some calling for increased supply of housing to help ease the strain.
In his pre-budget address, Treasurer Scott Morrison was on much the same page, and focused on infrastructure and increased supply of homes as a solution, saying, “We need to build more homes in this country.”
Want to know more? Head over to read about Scott Morrison’s plans to tackle housing affordability.