Poor missing out on affordable homes

Australia’s poor are finding it increasingly difficult to afford to house themselves because of a lack of cheap accommodation, new research has found.

A study led by Australian Housing and Urban Research Institute researcher Associate Professor Maryann Wulff found almost 80 per cent of 268,000 private renter households with very low incomes (less than $22,000 a year) miss out on affordable rental accommodation.

The research found that the situation was worsened by a trend of wealthier Australians occupying cheap housing that has traditionally been the domain of the poor.

The study, which analysed the amount and cost of housing as it related to various income groups between 2001 and 2006, found only 37 per cent of private renters with household incomes in the lowest 40 per cent of the national income distribution accessed affordable housing.

It found just 21 per cent of very low income private renter households pay an affordable rent and 19 per cent pay a severely unaffordable rent.

The study determined affordable rent as less that 30 per cent of gross household income.

'Very low income renters face affordability problems both because of an absolute shortage of housing that is affordable and because a significant proportion of affordable stock is not available to them because it is occupied by higher income households,' Prof. Wulff said.

'Low income renters (earning between $22,001 and $42,000) do not face an absolute shortage of affordable housing but are often excluded because affordable stock is occupied by other income groups,' she said.

For the 360,467 Australian households in the low income group, there was a net shortage of 87,000 affordable homes, partly because many cheaper homes are occupied by wealthier households, according to the study, entitled Australia’s private rental market: the supply of, and demand for, affordable dwellings.

For very low income private renter households in cities, the greatest shortages in affordable and available private rental dwellings were observed in Sydney (44,500 or 93% missing out), Melbourne (40,200 or 87% missing out) and Brisbane (19,100 or 87% missing out).

All eight large regional centres studied had high levels ofvery low income private renter households missing out on affordable rental housing; Gold Coast (93%) and the Sunshine Coast (88%), in Queensland. However, Geelong and Launceston had relative lower levels of shortages (64% and 63% respectively) than the others.

The study, by the AHURI Swinburne-Monash Research Centre, found age, living arrangements and number of children play an important role in determining access to affordable rental housing. Generally, elderly renters, people living alone, and households without children are more likely to find an affordable rental dwelling.

Very few younger renters or families with two or more children access affordable rental housing. About 33 per cent of young childless couples; 36 per cent of couples with children and 21 per cent of single parents pay over 50 per cent of their gross household income to access a rental dwelling.

The researchers said policies aimed at increasing the supply of affordable housing could use the findings of the study to determine the need for various types of dwellings and they suggested the adoption of a suitability concept which assessed household size and composition against dwelling type.

Full report: http://www.ahuri.edu.au/publications/download/50502_fr

www.ahuri.edu.au