Over two-thirds of renters reported rent stress, which is typically considered to be rental payments of over 30 per cent of household disposable income
Australian renters have been feeling the pain of skyrocketing rents over the first half of 2021.
Rent stress has soared in the six months to June with renters, on average, spending 41 per cent of their income on keeping a roof over their heads, according to a survey of 1500 households by ME Bank.
This represents a significant extra hit of 8 per cent.
Over two-thirds (68 per cent) of renters reported rent stress, which is typically considered to be rental payments of over 30 per cent of household disposable income.
ME’s consulting economist Jeff Oughton said a combination of factors was contributing to the rise in the nation’s rent stress.
Rental markets have tightened markedly across the majority of Australia and rents have risen significantly due to falling vacancies, he said. Renters are now facing some of the biggest rent hikes we’ve since the global financial crisis.
The survey results indicate the current level of rent stress is 3 per cent higher than before the onset of the coronavirus crisis in December 2019.
It also shows the pain is being felt most by single parents, couples with young children, retirees, and households on low incomes (less than $40,000 per annum) and below average incomes ($40,000-75,000 per annum) reported higher levels of rent stress.
Additionally, rent stress is higher for women (75 per cent) compared with men (60 per cent).
While wage gains, on average, have picked up slightly from the historical lows recorded at the onset of the pandemic, government income support has gradually unwound, and rental moratoriums have ended, Oughton said.
He said: We may see more renters facing hardship as lockdowns continue, particularly among low-income, low-saving households reliant on government support.