Property News

Source:   AFR. 27 February 2023 By Nila Sweeney 

Apartment supply is forecast to shrink by 73 per cent nationwide over the next two years, worsening the current rental shortage and potentially triggering price increases in some projects, new report shows.

Consultancy firm Charter Keck Kramer estimates that there are 41,200 apartments under construction and being marketed across the capital cities in 2023, but these are expected to fall to 27,300 in 2024 and down to 11,100 in 2025 – a 30,100 unit shortfall over two years.

In Sydney, apartment supply is set to slump by 14,500 units or 83.5 per cent by 2025, while Melbourne is expected to contract by 7900 units or 65.3 per cent.

The number of apartments under construction and being marketed is estimated to fall by 87.8 per cent in Brisbane, by 78.3 per cent in Canberra and by 65.2 per cent in Perth.

Richard Temlett, Charter Keck Kramer director of research and strategy, said the sharp decline in apartment supply would put a floor on prices and even spark increases in some projects.

“For established apartments that have been built, I think the supply shortage and strong demand will limit the price declines,” Mr Temlett told The Australian Financial Review.

“For new products, prices are going to have to increase, and it’ll start increasing over the course of 2023 across most projects. Some developers of projects aimed at downsizers who don’t need a mortgage to buy have already started to raise their prices.

“Prices will have to rise. Otherwise, developers won’t build it because of the heightened risk they are taking.”

The apartment sector is currently facing a number of substantial challenges that will ultimately stifle supply according to Mr Temlett.

“Rising rates are increasing project costs and also diminishing purchaser capacity and buyer demand, which is leading to slow presales in many projects,” he said.

“Alarmingly, but not surprisingly, construction costs continue to increase and the residual supply constraints have resulted in many projects not being financially feasible. This will lead to certain projects being deferred or even abandoned.”

Mr Temlett said the apartment supply shortage was likely to worsen the current rental crisis as immigration ramped up.

“I think the government might have underestimated the extra demand for housing as a result of increased immigration,” he said.

“Looking at lead indicators such as student visa applications, or actual overseas arrivals, they’re much higher than what the government had forecast and particularly in Melbourne, I think it’s going to be even stronger than what they’re forecasting.”

CoreLogic head of research Eliza Owen said there were 1.3 million returning overseas arrivals in 2022 that needed housing.

“Long-term overseas migrants largely rent when they first come to Australia, adding to demand and short-term visitor arrivals will also require accommodation,” Ms Owen said.

Mr Temlett said the supply crunch was likely to persist until interest rates stabilised and investors started flowing back into the market.

“The supply situation is going to tighten and potentially even get worse,” he said.

“So there’s an opportunity for the government to actually help the build-to-sell sector right now by encouraging local and foreign investors back into the market.”

Among these would be to introduce some incentives for investors to buy off-the-plan and to lower the barrier for foreign investors to buy apartments.

“We’re urging the government to reintroduce incentives such as off-the-plan stamp duty concessions to foreign and local investors. This is one avenue to stimulate the build-to-sell apartment market and mobilise the much-needed supply of rental stock,” Mr Temlett said.

“I can tell you that there’s a large number of foreign buyers from Singapore to Malaysia to Hong Kong and now the Middle East that are keen to buy apartments in Australia because of the strong fundamentals.”

Foreign investor buyers were needed to jumpstart apartment supply as they were more prepared to purchase off-the-plan, Mr Temlett said.

“Local and foreign investors typically make up around 75 per cent of sales of an apartment project, so they can substantially increase supply of rental homes in the near to medium term,” he said.

“We don’t really see how much of supply is going to get mobilised, unless those changes are made. It’s going to get worse because developers right now are not launching stock and pre-sales are very slow, so fewer apartments are getting built.”

Source:   The Urban Developer. 16 January 2023 By Ralph Nicholson 

The Blackwattle Bay Precinct, a Sydney Harbour foreshore project which over the next decade will create 1200 new apartments and about 100,000sq m of commercial space, has moved a step closer to fruition with final re-zoning approval.

Located less than a kilometre from central Sydney, the urban renewal covers about 10.4ha of harbour-front land between Anzac Bridge and the Sydney Secondary College on Bridge Road, Glebe. 

Some 1200 units in residential towers of between six and 35 storeys will be built on the old Sydney Fish Markets at Blackwattle Bay under revised plans by the New South Wales government’s development arm, Infrastructure NSW.

The rezoning was finalised in late December, however, not before 2400 submissions forced Infrastructure NSW to lower the five towers by as much as 21.5m, which meant nearly 380 fewer apartments.

 The revised plans also increase the width of the precinct’s proposed waterfront promenade to 30 metres—a demand by Sydney City Council.  When finished the promenade will fill in the missing link along the 15km foreshore walk from Rozelle Bay to Woolloomooloo.

Revitalisation of the inner-city precinct— historically an industrial area—includes the relocation of the Sydney fish market to new $10-million facilities, designed to become a major tourist attraction while supporting the NSW seafood industry.

 In June of 2020 the minister for planning and public spaces approved the relocation of the market to the head of the bay, which then freed up about 10.4ha of harbourside land for the new state significant precinct.

The new planning controls enable about 100,000sq m of commercial space, which the government says will lead to 5600 new jobs. The new apartments, expected to house about 2400, will be close to existing and proposed public transport, including the planned Pyrmont metro station.

More than 3ha of interconnected parks and public space will be created, including a new waterside park, ferry wharf, cafés, restaurants and retail.

 Speaking of the re-zoning finalisation, NSW Premier Dominic Perrottet said the government was unlocking yet another section of under-utilised harbor foreshore.
“Sydney is home to one of the most spectacular harbours in the world but for so long, much of the foreshore, such as Blackwattle Bay, has been neglected and left underutilised,” Perrottet said.

“This is all set to change with Blackwattle Bay to be transformed into an exciting new foreshore precinct and tourism drawcard.

“After more than five years of careful planning and engagement we now have the green light to breathe new life into the precinct, returning it back to the community as an iconic waterfront destination.”

The original Fish Market was established in 1871 at Woolloomooloo, the-then mooring site of the local Sydney fishing fleet.

Source:   Property Council Of Australia. 11 January 2023 By Aidan Green

  The Property Council of Australia has commended the NSW Labor Party on their commitment to deliver extra rental stock in the South Coast through their $30 million Build-to-Rent pilot program, if elected in March.

Property Council’s Acting NSW Executive Director Adina Cirson said New South Wales was in the midst of a rental crisis with record low vacancies and fast rising rental prices.

“Delivering more housing supply is the best chance we have of easing the regional rental squeeze across NSW,” Ms Cirson said.

“NSW Labor’s plan to use surplus government land and purchase new land for BTR developments is exactly the sort of government intervention we need to tackle the housing crisis head on.

“This welcomed announcement mirrors our recommendation in our election platform and encourage the Opposition to expand the pilot to provide subsidies to the private sector to also deliver all BTR projects, improve tax concessions and develop a BTR design guide.

“The Federal Government’s Housing Accord showed big capital is lining up to invest in the housing market and we shouldn’t stand in their way, which is why we also encourage the next NSW Government to lobby the Federal Government to reduce the 30 per cent withholding tax on foreign investment in BTR developments.”

Ms Cirson said offering a long-term rental subsidy to BTR providers to deliver affordable housing within BTR developments would ultimately deliver more housing supply to the regions.

“Under the program, a set percentage of dwellings could be provided at discounted rent via a 10-15 year subsidy to providers to meet the growing demand for secure long-term rental properties.”

Source:   realestate.com.au 7 June 2022 By Megan Neil Senior Journalist

 The Reserve Bank of Australia has hiked interest rates by a super-sized amount as Australians face increasing cost-of-living pressures, including soaring energy prices. 

The RBA board on Tuesday raised the official cash rate by a huge 50 basis points to 0.85%, after lifting rates last month for the first time since November 2010. 

RBA Governor Philip Lowe said inflation in Australia has increased significantly and is expected to rise further. 

"Given the current inflation pressures in the economy, and the still very low level of interest rates, the board decided to move by 50 basis points today," Mr Lowe said in a statement after Tuesday's board meeting.  

"Higher prices for electricity and gas and recent increases in petrol prices mean that, in the near term, inflation is likely to be higher than was expected a month ago.

" Mr Lowe noted global factors, including COVID-related disruptions to supply chains and the war in Ukraine, account for much of the significant increase in inflation. "But domestic factors are playing a role too, with capacity constraints in some sectors and the tight labour market contributing to the upward pressure on prices." He said the floods in New South Wales and Queensland earlier this year have also affected some prices. 

"Today's increase in interest rates by the board is a further step in the withdrawal of the extraordinary monetary support that was put in place to help the Australian economy during the pandemic. "The resilience of the economy and the higher inflation mean that this extraordinary support is no longer needed." 

The decision to hike rates by 50 basis points came as a surprise, with most economists predicting a 25 or 40 point rise. PropTrack economist Paul Ryan said the move advances the pace of normalising interest rates after the period of exceptionally low rates following the outbreak of the COVID-19 pandemic. 

"A 50 basis point hike is an exceptional move that signals the RBA is looking to move faster than they expected last month," Mr Ryan said. 

"This larger than 'business-as-usual' hike indicates the RBA is increasingly concerned about domestic inflationary pressures, and has assessed that they need to increase rates quickly to get them under control." 

Mr Lowe said inflation is expected to increase further before declining back towards the 2% to 3% range next year. 

Treasurer Jim Chalmers warned inflation has accelerated from the 5.1% rise over the year to the March quarter, adding it will be significantly higher than it is now. 

Dr Chalmers on Monday wrote to the Australian Competition and Consumer Commission expressing his "deep concern" about skyrocketing electricity and gas prices. Mr Ryan said the emerging energy crisis will push up prices significantly, leading the RBA to reassess its inflation forecasts. 

The RBA in May forecast headline inflation rate to rise to 6% in 2022 before moderating to about 3% by mid-2024. Mr Ryan said as the RBA has noted, there is still a lot of uncertainty about when the supply-shock factors influencing inflation, such as the war in Ukraine and supply chain disruptions in China, will abate. 

The RBA in May lifted the cash rate by 25 basis points to 0.35%, from a record low 0.1%. But the board also considered a 40 basis points increase given the upside risks to inflation and current very low level of interest rates. 

The RBA has made it clear there will be further rate rises and forecasts by economists at the four major banks put the cash rate at between 1.35% to 1.75% at the end of 2022. After last month's rate hike, Mr Lowe said it was not unreasonable to expect the cash rate would get back to "a more normal level" of 2.5% at some point. 

The 50 basis point increase in the cash rate will mean the average homeowner with a $600,000 loan will pay an extra $159 on their monthly repayments, according to RateCity. How high rates go will impact housing market Australia's housing market has already started slowing down in anticipation of the series of hikes in official interest rates, Mr Ryan noted. 

"Higher interest rate expectations have weighed on housing price growth across the country in 2022," he said. "Housing price growth has slowed significantly, with annual price growth falling from 24% six months ago to only 14% in the year to May. 

"This slowdown has particularly affected the most expensive capital city markets of Sydney, Melbourne and the ACT, which recorded price falls in May.

The PropTrack Home Price Index showed national price growth fell in May for the first time since the start of the pandemic. 

"More interest rate increases are expected in 2022, as inflation has been higher than anticipated by the RBA," Mr Ryan said. "But just how high interest rates will be at the end of the year is a key source of uncertainty for the housing market.

" Mr Ryan said financial markets have priced in a cash rate that is two percentage points higher at the end of the year, which would raise mortgage repayments by another 24%. "Major bank forecasters, however, do not view it likely the RBA will increase rates this quickly, predicting rate rises closer to half that much. 

"This 50 basis point increase by the RBA may lead bank forecasters to move closer to financial market estimates." 

Source:   Financial Review 3 May 2022 By Larry Schlesinger

 An industrial site in Sydney’s inner west that could yield more than 1000 apartments and a shopping precinct once rezoned is expected to sell for more than $300 million after being listed for sale by two prominent local families. 

The 3.12 hectare Five Dock property at 129 – 153 Parramatta Road and 53-75 Queens Road – about 11 kilometres west of the Sydney city centre – has already attracted the attention of major build-to-rent and build-to-sell developers both locally based and offshore. 

To be marketed as Kings Bay Village, the site has been amalgamated over more than 20 years by the Dodaro and Drivas families, headed respectively by commercial lawyer and Raine & Horne franchisee Robert Dodaro and developers George and Dimitri Drivas. 

It is home to more than 22,000 square metres of leased industrial buildings but is expected to be rezoned for mixed-use purposes this year as part of a proposal led by the City of Canada Bay Council aimed at transforming a portion of the Parramatta Road corridor running through Five Dock into more community-friendly infrastructure. 

Once rezoned, the site could support more than 90,000 square metres of gross floor area, including multiple residential towers as high as 20 storeys. 

With the median apartment price in Five Dock about $1 million, a future development could yield well over $1 billion of residential and retail end value in an area facing an undersupply of apartment stock, according to selling agents James Cowan, Matthew Meynell and Trent Gallagher from Colliers. 

“The site is difficult to price given the rarity of the offering. However, interest before the launch of the official sales campaign has been north of $300 million from both build-to-rent and build-to-sell groups,” Mr Cowan said. 

Its prime inner-city location, a 10-minute walk from both the Burwood North and Five Dock Metro Stations that are to be built as part of Sydney Metro West, is expected to draw in competing bids from major developers. 

The Australian Financial Review understands that those showing interest in the site include global BTR specialists Greystar and Sentinel as well as the likes of Sydney-based developers Meriton, JQZ and Deicorp. 

“Our recent experience in marketing significant, generational, assets such as Kings Bay Village has demonstrated the vast depth of capital seeking bulk and scale,” said Mr Gallagher. 

Source:  ABC News Australia   3 May 2022  by Business Reporters Michael Janda and Emilia Terzon

The Reserve Bank has increased interest rates for the first time in more than 11 years, with a 25-basis-point hike taking the cash rate target to 0.35 per cent. 

Key points: 

• The Reserve Bank's 25-basis-point increase to the cash rate target takes it to 0.35 per cent 

• The RBA governor warns that getting inflation under control "will require a further lift in interest rates" 

• Financial markets and economists expect the next official rate rise to occur in June.

If passed on in full by banks, the rate rise will add $65 a month to repayments on a $500,000 mortgage, and double that on a million-dollar loan. 

The Commonwealth Bank was the first major bank to respond, raising its standard variable mortgage rates by 25 basis points across the board from May 20, while ANZ will lift rates by the same amount from May 13. 

The move came as little surprise to financial traders, who had priced in around a two-thirds probability of the RBA raising rates this month. 

Reserve Bank governor Philip Lowe said the combination of recent very high inflation numbers and evidence that workers were starting to get bigger wage increases meant the time was right for "normalising" interest rates away from emergency lows. 

"The board is committed to doing what is necessary to ensure that inflation in Australia returns to target over time," he noted in his post-meeting statement. "This will require a further lift in interest rates over the period ahead." 

Mr Lowe told reporters that the cash rate still had a long way to go to get back to more normal levels where it at least matched the rate of inflation. 

"Over time it is not unreasonable to expect interest rates would get to 2.5 per cent. 

"How quickly we get there, and if we do get there, will be determined by how events unfold."

Economists at the major banks remain deeply divided about how high interest rates would rise — from a 1.6 per cent forecast at the Commonwealth Bank up to more than 3 per cent tipped by ANZ. 

Westpac was somewhere in the middle, tipping a 2 per cent cash rate sometime next year. 

RateCity estimates that would add $512 a month to a $500,000 mortgage, and double that — $1,025 a month — to a million-dollar loan.  

Source:  Business Australia   3 May 2022  by (Staff Writer)

During a meeting on Tuesday, 3 May, the RBA board decided to increase the cash rate target by 25 basis points to 35 basis points. It also increased the interest rate on Exchange Settlement balances from 0% to 25 basis points. 

“The board judged that now was the right time to begin withdrawing some of the extraordinary monetary support that was put in place to help the Australian economy during the pandemic,” the RBA said.  

“The economy has proven to be resilient and inflation has picked up more quickly, and to a higher level, than was expected. There is also evidence that wage growth is picking up. Given this, and the very low level of interest rates, it is appropriate to start the process of normalising monetary conditions.” 

The RBA said its central forecast was for Australian GDP to grow by 4.25% over 2022 and 2% over 2023. “Household and business balance sheets are generally in good shape, an upswing in business investment is underway and there is a large pipeline of construction work to be completed,” the central bank said.  

“Macroeconomic policy settings remain supportive of growth and national income is being boosted by higher commodity prices.” 

The RBA observed that inflation has picked up significantly and by more than expected, although it remains lower than in most other advanced economies. Over the year to the March quarter, headline inflation was 5.1% and in underlying terms inflation was 3.7%.  

The Australian Chamber of Commerce and Industry (ACCI) warned of rising prices back in December 2021, when it released its latest ACCI-Westpac Survey of Industrial Trends.  

In the December quarter, input cost pressures remained elevated, with a net 38% of firms reporting higher input costs. The sustained period of cost pressures over the past previous three quarters, at a net 39%, was the highest average level since December 2008 

“Cost inflation has been a significant issue throughout the COVID pandemic and recovery, with supply chain disruptions globally and domestically, border closures, and a tight labour market all viewed as contributing factors,” the ACCI said.  

Following Tuesday’s rate hike, the RBA stated that it was committed to doing what was necessary to ensure the inflation in Australia returned to target over time.  

“This will require a further lift in interest rates over the period ahead. The board will continue to closely monitor the incoming information and evolving balance of risks as it determines the timing and extent of future interest rate increases,” the bank concluded. 

Source:  SMH   14 April 2022  by By Kate Burke and Melissa Heagney

Sydneysiders are paying $50 more a week to rent a house, with the median rental asking price rising at the fastest annual rate in 13 years. 

Despite holding steady at a record median $600 for the March quarter, Domain’s latest Rent Report showed house rents in Greater Sydney were up 9.1 per cent for the year. (Source: Domain Rent Report Q1 2022) 

Unit rents climbed $30 over the year, or 6.4 per cent, to a median of $500 – the sharpest annual increase in eight years. Rents lifted 2 per cent in the past three months alone, doubling the previous quarterly growth and outpacing houses for the first time since the pandemic began. 

Sydney’s rental market is now the third most expensive for houses, after Canberra and Darwin, with respective medians of $700 and $610. 

Domain’s chief of research and economics, Dr Nicola Powell, said Sydney’s rental market had seen a swift recovery after demand dropped off earlier in the pandemic, particularly in the inner-city. 

Renter demand had spiked as domestic and international borders reopened, while high purchasing prices left more aspiring homeowners renting for longer. 

“We may also be seeing the homecoming of city escapees from lifestyle and coastal locations, further driving demand,” Powell said. 

Increased competition for rentals, and lower supply, saw the city’s rental vacancy rate drop to 1.4 per cent in March, the lowest point since Domain vacancy records began in 2017 and down from a peak of 3.8 per cent in April 2020. 

“Vacancy rates are dropping like a stone in both Sydney and Melbourne and that’s driving rental growth,” ANZ senior economist Felicity Emmett said. 

Sydney’s previously elevated vacancy rate had quickly turned around as borders reopened, boosting demand – particularly in inner-city areas popular with international students – which had driven stronger rent hikes for the apartment market.

Meanwhile, rental stock had reduced, with some landlords opting to sell investment properties earlier in the pandemic. Properties were also being returned to the short-term holiday market now that tourism had resumed. 

Rental supply issues largely seen for houses in outer areas in recent years, as tenants flocked to bigger homes and outer suburbs amid lockdowns and remote working, were now shifting to inner areas, putting upward pressure on rents. 

The city and inner south recorded some of the sharpest rent hikes over the quarter, with house and unit rents both jumping more than 5 per cent. House rents held at record highs on the northern beaches, the outer west, the Blue Mountains, Baulkham Hills and Hawkesbury regions. 

The northern beaches was the only area to record a decline in apartment rents over the quarter, falling from a record high of $650 to $630. (Source: Domain Rent Report, March quarter 2022) 

“We talk about that ceiling price in the sales market … and I think a similar thing may be happening in the rental market,” Powell said. 

“Budgets can only stretch so far, people will compromise on property type and then compromise on location. Other areas are offering much better bang for buck for tenants.” 

Northern beaches local Heidi Malligan said it was “near impossible” to secure a rental, with tenants facing strong competition and high prices, with the median asking rent for houses up 9.5 per cent over the year to $1150 a week. 

Malligan’s family moved into a four-bedroom house in Frenchs Forest this week, paying $20 above the advertised rate of $1700 to secure the keys. 

“We had to adjust our expectations and be willing to offer more to secure a place,” Malligan said, adding she offered up to $80 above the advertised rate and to pay rent up to 12 months in advance, on other properties she missed out on. 

Renting short-term, between selling and buying a home, she said she felt for long-term tenants and noted an undersupply of affordable housing meant poor quality properties were commanding high prices. 

Demand was back to pre-pandemic levels, and now even stronger for some properties, with homes typically seeing five applications after a single viewing. 

“Even smalls studios that weren’t all that popular [last year] because people wanted to have more space ... are now finding tenants relatively quickly,” she said. 

Those hoping the cooling conditions seen in the sales market would flow through to the rental market may be left disappointed, with independent economist Saul Eslake saying while prices were predicted to soften this year, as interest rates rise, it would not affect rising rents. 

“There is not much connection in my view between property prices and rents,” Eslake said. 

“If you look back at late 2017 to mid-2019, prices went down in Sydney and Melbourne but that had no impact because there were no falls in rents during that period.” 

Rents would rise when demand was high and supply low, he said. 

Source:  SMH  5 April  2022  by Kate Burke 

Australian tenants face a worsening rental crisis, with competition for homes soaring as the proportion of vacant rental properties falls to its lowest level in years. 

The national rental vacancy rate fell to 1 per cent in March, halving year-on-year, with all capital cities now operating in a landlord’s market, Domain’s latest Rental Vacancy Rate report found. 

Landlords in competitive markets are being inundated with applications amid the shortage of available rentals, and tenants are increasingly offering above the advertised price, or up to a year’s rent in advance, to try to secure a home, agents have reported. 

Domain’s chief of research and economics, Nicola Powell, said Australia was facing a rental crisis, with already strained rental markets under increased pressure following the reopening of international and domestic borders. 

“With many cities already sitting at record high asking rents, combined with the current tightening conditions, we’re likely to see rental price increases continue, causing worsened conditions for tenants,” Dr Powell said. (Source: Domain.com.au)  

Vacancy rates nationally, as well as in Sydney (1.4 per cent), Canberra (0.5), Brisbane (0.7), Adelaide (0.2) and Perth (0.5), have reached their lowest point since Domain records began in 2017, and Darwin (0.5) is close to a record low. 

Hobart recorded a marginal increase, but with a rate of 0.3 per cent it remains one of the most competitive capital city markets. 

“In some of our cities it is like finding a needle in a haystack when trying to find an available rental,” Dr Powell said. Sydney and Melbourne had the biggest monthly fall in vacancy rates, now at 1.4 per cent and 1.8 per cent respectively. 

Dr Powell said inner-city markets hard hit during the pandemic were subject to a resurgence in demand as borders reopened and tenants took advantage of lower rents. While demand had risen, supply had fallen, with some rental properties having been sold during the pandemic while others came back to the short-term rental market as tourism resumed. 

Inner Brisbane, which recorded a vacancy rate of 1.5 per cent, had one of the largest monthly falls of the capital city regions. As did areas such as Indooroopilly, Sherwood, Nathan and Salisbury. 

“There’s a lot of people out there searching right now; a lot of places are getting snapped up pretty fast,” said Kelsey Smith, a business development manager at Living Here Cush Partners. 

Rental demand had risen as Brisbane attracted more interstate arrivals and rapidly rising property prices left more aspiring homeowners renting for longer, Ms Smith said. The recent floods had further exacerbated the rental shortage in some markets, she added. 

While she did not want to encourage rent bidding, Ms Smith said strong competition was prompting more tenants to offer above the advertised rental price, noting that one Bulimba home recently leased for an additional $50 a week to tenants relocating from interstate. Landlords, meanwhile, were increasingly looking to test demand with above-market prices, which they would lower if they had no takers. 

Inner-city markets have registered large declines in vacancy rates, and the strongest competition is still being seen in middle to outer ring suburbs and lifestyle locations, which tenants flocked to while working and studying remotely during the pandemic. 

In the Maroondah region in Melbourne’s east, which has one of the city’s lowest vacancy rates of 0.6 per cent, nine out of 10 homes were being leased after the first open home, said senior property manager Anne Johnsen, of Fletchers Maroondah.

In a bid to beat the competition, more tenants were offering to pay above the advertised price, typically up to $20 a week extra, and some were offering several months’ worth of rent upfront, sometimes a year in advance. 

“It’s crazy – that’s how desperate people are to secure a home,” Ms Johnsen said, adding that personalised letters appealing to landlords and property managers were also becoming more common. 

Declining vacancy rates and rising rents were making it harder for tenants to find, and hold on to, an affordable home, said Tenants’ Union of NSW chief executive Leo Patterson Ross. Renters were increasingly compromising on the size, location and quality of properties to secure a rental, while existing tenants were more likely to let unanswered repair requests or other breaches of the tenancy contract slide. 

“They know they are susceptible to being asked to move on and will have a hard time finding somewhere and likely face higher rent for a smaller place or have to move even further away,” Mr Patterson Ross said. 

Rents were on the rise for existing tenants, with even greater hikes between tenancies, and more properties were now leased above the advertised rate, with rent bidding on the rise. 

Increasing housing supply was key to addressing the crisis, Mr Patterson Ross said, particularly social and affordable housing targeted at helping those left behind by the private market. Such tenants would not be in a position to use first-home buyer assistance schemes to purchase a home – which Prime Minister Scott Morrison recently described as the best way to support renters. Boosting the supply of social and affordable rental housing would ease pressure for the most affordable rentals, which would then flow through to the broader market, he said. A national housing strategy was also needed, he said. 

(Please note this article was updates since it was published to reflect new information made available after publication. )