Search

To move or not to move: is it cheaper to find a new place or stay when your rent increases by 10%?

<a href="https://theconversation.com/profiles/park-thaichon-175182">Park Thaichon</a>, <a href="https://theconversation.com/institutions/university-of-southern-queensland-1069">University of Southern Queensland</a> and <a href="https://theconversation.com/profiles/sara-quach-175976">Sara Quach</a>, <a href="https://theconversation.com/institutions/griffith-university-828">Griffith University</a> Your landlord has just raised your rent by 10% and your mind starts running the numbers – should you cop it sweet or look to move? It’s a familiar scenario in today’s unpredictable housing market. Understanding the real costs of staying versus moving is essential for making informed choices: renters must consider hidden expenses such as moving costs, deposits and changing rental rates, giving them tools to handle rising rent pressures more effectively. <h2>A grim time for many renters</h2> National median market rents have hit record highs, reaching $627 per week, with an average annual growth rate of 9.1% during the past three years, according to real estate giant <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_departments/Parliamentary_Library/Budget/reviews/2024-25/Housing#:%7E:text=Based%20on%20April%202024%20CoreLogic,the%20past%203%20calendar%20years">CoreLogic</a>. <a href="https://www.corelogic.com.au/news-research/news/2024/rent-growth-picked-up-in-the-start-of-2024,-taking-rents-to-new-record-highs">CoreLogic</a> also reported annual rental changes (houses and units) in regional Australia are not far off from the big cities: annual rent changes were 9.4% for combined capital cities, 6.4% for combined regional areas, and 8.5% nationally. So, is it better to stay or move if your rent is raised by 10%? Let’s examine the costs and benefits of each option. <h2>A breakdown of typical moving costs</h2> We’ll start with the most obvious expense: moving costs. Professional moving services aren’t cheap. For example, moving a three-bedroom house in the Gold Coast costs <a href="https://www.muval.com.au/removalists/gold-coast">$1,095.25 on average</a>, with an hourly rate of $158.26. In a bigger city like Melbourne, the cost is slightly higher at <a href="https://www.muval.com.au/removalists/melbourne">about $1,118.46</a>. The moving costs between states or cities will be more expensive if you move further away. You could choose to handle packing yourself and hire some help with a truck – a common option with businesses such as “<a href="https://www.gumtree.com.au/s-removals-storage/gold-coast/2+men+and+a+truck/k0c18643l3006035">Two Men and a Truck</a>”, which typically costs around $100 per hour. Be aware, though, that the hourly rate often starts from the moment the truck leaves the company’s warehouse until it returns. Alternatively, you can rent a van for a lower price, such as $87 for a 24-hour <a href="https://www.bunnings.com.au/for-hire-handivan-24hr-first-100kms-inc-_p5470402">Handivan rental at Bunnings</a>. Don’t forget the cost of moving boxes, too: Bunnings’ 52 litre <a href="https://www.bunnings.com.au/bunnings-52l-light-duty-moving-carton_p0517130?srsltid=AfmBOoqCYAWT0P5apPiJpoOLRAIpUCHNi63ztvIZrG5CxCoNOv45G0TV">moving cartons</a> cost $2.66 each. End-of-lease or <a href="https://firstcallhomeservices.com.au/service-menu/bond-exit-end-lease-cleaning/">bond cleaning</a> is another common expense. For a typical three-bedroom property, internal cleaning can range from $365 to $500. If you have pets, or kids who love drawing on the walls, your cleaning costs might be a bit higher. Now, let’s look at utility connection expenses that can catch people by surprise. Cancelling your internet service can be costly if you don’t meet the exit or cancellation policies. With <a href="https://www.telstra.com.au/internet/5g-home-internet">Telstra Home Internet</a>, for example, if you cancel within the first 24 months, you must return your modem within 21 days to avoid a $400 non-return fee. Most providers charge a cancellation fee or require final device repayments, typically ranging from $100 to $500, depending on the remaining contract period. As a renter, it might be wise to choose a no-lock-in contract plan to avoid these fees if you need flexibility. Electricity and gas connection and disconnection fees are usually minor but can add up, often costing about $40 to $60 for <a href="https://www.energyon.com.au/fees-and-charges/">connection and disconnection fees</a> for electricity alone. If your house uses gas for hot water or cooking, you may have to pay additional fees for setting up service. However, there are also non-financial costs, like the time spent searching for a new home, attending inspections, and putting in applications. Moving takes effort and energy for packing, transporting and unpacking. Some people feel emotionally attached to their current home, which can make leaving harder. Older renters <a href="https://www.sciencedirect.com/science/article/abs/pii/S1353829218311304">seem to draw strength</a> from their familiarity with, attachment to, and enjoyment of their place and community. This is something to be considered. Plus, moving can take <a href="https://www.nature.com/articles/s41537-023-00349-w">an emotional toll</a>. <h2>The benefits of not moving</h2> The clear benefit of staying is avoiding the hassle of relocating. Staying means saving on moving expenses and avoiding the time spent searching for a new place, packing and unpacking. This may also save some people from needing to take time off work. Changing and updating an address is also another tedious task that can be avoided by staying. Moving can hit the hip pocket with “after moving costs” that people may not initially consider. For instance, a new location might mean a longer commute. If each trip adds just 15 extra minutes, that could amount to an additional 11 hours per month over 22 workdays. For drivers, increased fuel and parking expenses might also come into play. Is the current or new location closer to a supermarket, hospital, and school? This proximity could be beneficial or detrimental, depending on the surrounding environment and available services. <h2>To move or not to move?</h2> One point to note is that overall, moving costs are likely to be similar between big cities and regional areas if you get moving supplies or rent a van from a large company such as Bunnings. In the end, moving costs will be around $2,000 based on the figures above, and it can be around $800 to $1,000 cheaper if you opt to rent a van instead of using a full-service moving company. Therefore, if the current rent is $600 per week and is about to increase by 10% to $660, the additional cost would be $3,120 per year. So is it cheaper to move or stay when your rent increases by 10%? The answer is moving may save about $1,000 to $2,000, but comes with the hassle and emotional toll of relocation. Staying will be more expensive, but with less hassle and emotional strain. The right choice depends on your situation.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/243155/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/park-thaichon-175182">Park Thaichon</a>, Associate Professor of Marketing, <a href="https://theconversation.com/institutions/university-of-southern-queensland-1069">University of Southern Queensland</a> and <a href="https://theconversation.com/profiles/sara-quach-175976">Sara Quach</a>, Senior Lecturer in Marketing, <a href="https://theconversation.com/institutions/griffith-university-828">Griffith University</a> Image credits: Shutterstock This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/to-move-or-not-to-move-is-it-cheaper-to-find-a-new-place-or-stay-when-your-rent-increases-by-10-243155">original article</a>.

Money & Banking

Becoming a landlord while still renting? ‘Rentvesting’ promises a foot on the property ladder, but watch your step

<a href="https://theconversation.com/profiles/james-graham-1264059">James Graham</a>, <a href="https://theconversation.com/institutions/university-of-sydney-841">University of Sydney</a> As home ownership moves further out of reach for many Australians, “rentvesting” is being touted as a lifesaver. Rentvesting is the practice of renting one property to live in yourself, while simultaneously purchasing an investment property somewhere cheaper and leasing it out. Ideally, “rentvestors” get to enjoy the capital gains on an investment property while living where they actually want to live, allowing them to cash in and upsize to their dream home later. It might seem like a savvy way to game the property market. But what are the risks of such an investment strategy? And how might broad adoption of this behaviour affect housing affordability in Australia? <h2>A rising tide lifts all boats differently</h2> The aim of the rentvesting game is to buy cheap property now, ride the expected capital gains, and move into a more desirable home down the track. The hope is that by climbing the first rung of the property ladder early, the whole thing won’t be pulled up out of reach. The first problem with this strategy, however, is that capital gains on housing are not always and everywhere equal. Generally, the cheapest properties available to rentvestors will be houses in the regions or apartments in the city. But both regional housing and apartment properties <a href="https://www.abc.net.au/news/2024-02-20/house-apartment-price-gap-widens-record-high-property-market/103484076">tend to appreciate more slowly</a> than the inner-city houses rentvestors might hope to live in one day. They might get a foot on the property ladder, but the rungs themselves are slowly drifting apart. Would-be rentvestors should also be aware that investments by “out-of-town” buyers tend to generate <a href="https://academic.oup.com/rfs/article-abstract/29/2/486/1902789">much lower returns</a> – both capital gains and rental yields – than investments by locals. Out-of-towners don’t know the local market trends, don’t know which neighbourhoods to avoid, and aren’t able to monitor their investments as effectively from afar. Avoiding the regions by investing in city apartments presents its own difficulties. Large, unexpected maintenance bills and poor strata management are <a href="https://www.abc.net.au/news/2024-03-21/a-world-of-hidden-charges:-strata-company-insiders/103617944">common complaints</a>. <h2>Different costs lead to different returns</h2> Perhaps the potential rentvestor should invest in something more straightforward instead, like stocks. After all, the return on equities in Australia has <a href="https://academic.oup.com/qje/article/134/3/1225/5435538">outperformed housing</a> in recent decades. However, it is much easier to borrow to invest in property than it is to borrow to invest in the stock market. And leverage is the investor’s secret weapon. For example, if house prices were to appreciate at 10% per year, then using a mortgage and a A$100,000 deposit on a $1 million property would earn you a 100% return on equity before costs. But while both investors and homeowners would earn that same basic return, their costs could be very different. For starters, property investors face capital gains tax on the proceeds of property sales, <a href="https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/property-and-capital-gains-tax/your-main-residence-home/eligibility-for-main-residence-exemption">unlike those selling their primary residence</a>. Banks also typically charge <a href="https://www.rba.gov.au/chart-pack/interest-rates.html">higher interest rates</a> on mortgages to investors than to homeowners. At times, the Australian Prudential Regulation Authority has also imposed caps on bank lending against investment properties, making it more difficult to find mortgage financing in the first place. Highly leveraged properties require mortgage insurance, too. Investors may need to take out larger insurance policies against the properties themselves, reflecting the higher risks associated with investment properties. Then, you also have to throw in property management fees, council rates, strata management fees and regular and unexpected maintenance costs. <h2>Negative gearing offers little benefit</h2> What about negative gearing? Property investors that generate losses on their property can deduct these costs against the tax bill on their other income. But negative gearing disproportionately benefits high-income earners with large tax bills. The <a href="https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/personal-income-australia/latest-release">median Australian individual income</a> is around $55,00, which generates a tax bill of about $8,000 – not a lot from which investment property losses can be deducted. The bigger picture is that while negative gearing helps defray the regular costs of managing a property, it doesn’t do anything to change expected capital gains. At the end of the spreadsheet tally, an investment property could end up earning rentvestors significantly less than they could have gained by simply buying their first home. <h2>Effects on housing affordability</h2> Rentvesting is new enough that its prevalence and influence awaits formal academic study. But economists might speculate about its implications for the housing market more broadly. The simplest analysis suggests that a rentvestor occupies one rental property while supplying an additional rental property to the market. If, instead, they had bought a home, they would vacate a rental property while removing another property from the market. In this case, even rentvesting en masse would have zero net effect on the housing market. But a more nuanced perspective might consider where rentvestors are renting and where they are investing. Perhaps they are most likely to rent properties in the already-crowded inner city, but purchase investment properties in regional areas where other first home buyers would like to live. This would increase demand for rentals in the city and reduce the supply of owner-occupier properties in the regions, worsening the affordability of both. Of course, if these rentvestors all eventually move up the property ladder – selling in the region and purchasing in the city – this effect would be reversed. From that longer-term perspective, rentvestors would ultimately have little effect. <h2>We still need more houses</h2> Rentvesting is not a panacea for Australia’s housing market woes. Potential investors should weigh the benefits of property investment against its substantial costs and risks. Additionally, they need to carefully consider the obvious alternative: simply buying their first home up-front. We have good reason to be wary of yet another get-rich-quick scheme involving the housing market. But initial considerations suggest that for the market overall, rentvestor behaviour is no worse than someone simply buying their first home, which we would otherwise encourage. Rather than criticising those seeking a way though our housing market morass, we might instead redouble our efforts to increase the supply of housing.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/229116/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/james-graham-1264059">James Graham</a>, Lecturer in Economics, <a href="https://theconversation.com/institutions/university-of-sydney-841">University of Sydney</a> Image credits: Getty Images This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/becoming-a-landlord-while-still-renting-rentvesting-promises-a-foot-on-the-property-ladder-but-watch-your-step-229116">original article</a>.

Money & Banking

The debate: Should kids over 18 pay rent if they’re still living at home?

Parents have shared their thoughts on letting their children live at home rent free, as the age old debate of paying board stirred up some strong opinions. A <a href="https://honey.nine.com.au/money/should-children-over-the-age-of-18-pay-board-if-they-still-live-at-home-reader-poll-exclusive/77876711-2950-4bf3-bb30-716442a6fd74" target="_blank" rel="noopener">nine.com.au</a> reader survey asked the question: Should children over the age of 18 pay board if they still live at home? The responses were many and varied, as a whopping 72 percent of respondents said grown up kids should be contributing financially to the household. One person commented, "If children have employment, it's important that they clearly understand that life is not free and they need to budget, show accountability and responsibility." Another wrote, "If the children over 18 are working, then yes, they should contribute or give money to the parents to bank for them." Others said children shouldn't be expected to pay board, and would rather their kids save money for bigger financial commitments. "My parents did not charge me board even though I was working because they did not need the money and told me to save for my first car, which I did," one person shared. Another wrote their parenting tactic, writing, "I let my children not pay board. So they could save for a deposit on a house. They did and they all (3) have a house." Despite many people sharing their strong opinions on the matter, most respondents said it was not a black and white question, as many households have individual circumstances that affect their decision. "Depends on if they are working or not and what income the parents have. My son is 22 but unemployed due to health problem, we just pool our unemployment payment so it differs for each family situation, not a YES or No answer," one reader wrote. Another said it depends on their employment and study status, writing, "Yes if they're working almost full time, not if they're studying and just working part time to cover living expenses." The poll comes as Aussies have struggled with a rise in basic living costs, with <a href="https://www.finder.com.au/australian-household-spending-statistics" target="_blank" rel="noopener">ABS</a> data showing that Australian households spent a total of $1.2 trillion on what was classed as general living costs in 2022. This sum is close to $100 billion more than in 2021. The average household spent $130,353 in 2022, which is the equivalent of $2507 per week. This is a 20.4 per cent jump on the previous year. Image credits: Getty Images

Money & Banking

Princess Diana's childhood home up for rent

The house Princess Diana spent her childhood and teenage years in is now available for the public to rent. Althorp House, located in West Northamptonshire in England, is owned by Diana's brother Earl Spencer, who has lived on the sprawling property as custodian of the estate since 1992. The expansive property has been listed for royal fans with deep pockets to rent on <a href="https://www.elysian-estates.co.uk/althorp/" target="_blank" rel="noopener">Elysian Estates</a>, an upmarket equivalent of Airbnb. Althorp House, which is a 90 minute drive out of London, was built in 1508 and has been in the Spencer family for 19 generations. Lady Diana lived in the 90-room stately home for most of her childhood and teenage years, before she married the then-Prince Charles in 1981. Not just one grand property, the estate covers 13,000 acres of countryside as it encompasses cottages, farms, woodlands and villages, which are open to visitors but only at certain times of the year. Now, the home is once again available to rent via Elysian Estates. "Althorp offers unparalleled levels of service, privacy and luxury to rival the finest properties anywhere in the world; yet retains the truly welcoming and homely feel that makes Althorp so special," the listing says. "Walk in the footsteps of kings and queens, feast or celebrate in spectacular surroundings, marvel at the sense of history and artwork, and slumber in pure luxury." In the main house, there are six state bedrooms to choose from offering "a level of opulence befitting royalty, with these very rooms playing as much a part of English history as any royal palace". Prices for the rental are not yet publicly available as an enquiry must be sent to reserve the opulent property. The listing stated that the stay includes "butler service, a team of private chefs and housekeeping, with a dedicated concierge service". Althorp is today most famous for being the final resting place of Princess Diana following her death in Paris. Image credits: Getty Images / Instagram

Real Estate

The rental housing crisis is hurting our most vulnerable and demands a range of solutions (but capping rents isn’t one of them)

<a href="https://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, <a href="https://theconversation.com/institutions/university-of-south-australia-1180">University of South Australia</a> and <a href="https://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>, <a href="https://theconversation.com/institutions/university-of-adelaide-1119">University of Adelaide</a> Roughly <a href="https://www.abs.gov.au/statistics/people/housing/housing-occupancy-and-costs/2019-20">one in three Australians</a> rent their homes. It’s Australia’s fastest-growing tenure, but renting is increasingly unaffordable. From 2020 to 2022, our <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4253168">research</a> found a large increase in the proportion of renters who said their housing was unaffordable. <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=217&fit=crop&dpr=1 600w, https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=217&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=217&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=273&fit=crop&dpr=1 754w, https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=273&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/542737/original/file-20230815-25187-p7vxqo.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=273&fit=crop&dpr=3 2262w" alt="horizontal bar chart showing changes in Australian renters' assessments of affordability form 2020 to 2022" /></a><figcaption>Change in Australian renters’ assessments of affordability from 2020 to 2022. Baker, Daniel, Beer, et al, forthcoming, The Australian Housing Conditions Dataset, doi:10.26193/SLCU9J, ADA Dataverse</figcaption></figure> Australians are concerned about the <a href="https://www.theguardian.com/australia-news/2023/jul/05/rents-rise-again-across-australia-with-sydney-seeing-fastest-rise-in-20-years">pace</a> of <a href="https://www.sbs.com.au/news/article/how-much-has-rent-increased-around-australia/8ljlnf0zm">rent rises</a>. Prime Minister Anthony Albanese <a href="https://www.pm.gov.au/media/national-cabinet-meeting">says</a> increasing housing supply and affordability is the “key priority” for tomorrow’s national cabinet meeting. The crisis has impacts well beyond affordability. The rental sector is where the worst housing accommodates the poorest Australians with the worst health. <h2>The unhealthy state of rental housing</h2> Forthcoming data from the <a href="https://dataverse.ada.edu.au/dataverse/ahcdi">Australian Housing Conditions Dataset</a> highlight some of these parallel challenges: <ul> <li> it’s often insecure – the average lease is less than 12 months, and less than a third of formal rental agreements extend beyond 12 months </li> <li> rental housing quality is often very poor – 45% of renters rate the condition of their dwelling as “average, poor, or very poor” </li> <li> poor housing conditions put the health of renters at risk – 43% report problems with damp or mould, and 35% have difficulty keeping their homes warm in winter or cool in summer </li> <li> compounding these health risks, people with poorer health are over-represented in the rental sector. Renters are almost twice as likely as mortgage holders to have poorer general health. </li> </ul> Measures that potentially restrict the supply of lower-cost rental housing – such as rent caps – will <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4253168">worsen these impacts</a>. More households will be left searching in a shrinking pool of affordable housing. <h2>It’s all about supply</h2> Fixing the rental crisis needs more than a single focus on private rental housing. The movement between households over time between renting and buying homes means the best solutions are those that boost the supply of affordable housing generally. No one policy can provide all the answers. Governments should be looking at multiple actions, including: <ul> <li> requiring local councils to adopt affordable housing strategies as well as mandating <a href="https://www.ahuri.edu.au/analysis/brief/understanding-inclusionary-zoning">inclusionary zoning</a>, which requires developments to include a proportion of affordable homes </li> <li> improving land supply through better forecasting at the national, state and local levels </li> <li> giving housing and planning ministers the power to deliver affordable housing targets by providing support for demonstration projects, subsidised land to social housing providers and access to surplus land </li> <li> boosting the recruitment and retention of skilled construction workers from both domestic and international sources. </li> </ul> <h2>The biggest landlord subsidy isn’t helping</h2> More than <a href="https://data.gov.au/data/dataset/taxation-statistics-2020-21/resource/ebbd32e3-4556-41e1-a8b9-33387457d518">1 million Australians</a> claim a net rent loss (negative gearing) each year. Even though negative gearing is focused on rental investment losses, it is not strictly a housing policy as it applies to many types of investment. The impact of negative gearing on the housing system is untargeted and largely uncontrolled. As a result, it’s driving outcomes that are sometimes at odds with the need to supply well-located affordable housing. The most impactful action the Australian government could take to deliver more affordable rental housing nationwide would involve refining negative-gearing arrangements to boost the supply of low-income rentals. These measures may involve <ul> <li>limiting negative gearing to dwellings less than ten years old</li> <li>introducing a low-income tax credit scheme similar to the one in the United States.</li> </ul> We can learn much from the US, where the Low-Income Housing Tax Credit (<a href="https://www.huduser.gov/portal/datasets/lihtc.html">LIHTC</a>) scheme subsidises the acquisition, construction and renovation of affordable rental housing for tenants on low to moderate incomes. Since the mid-1990s, the program has supported the construction or renovation of about 110,000 affordable rental units each year. That adds up to over <a href="https://www.taxpolicycenter.org/briefing-book/what-low-income-housing-tax-credit-and-how-does-it-work">2 million units</a> at an estimated annual cost of US$9billion (A$13.8billion). This scheme is much less expensive per unit of affordable housing delivered than Australia’s system of negative gearing. Closer to home, the previous National Rental Affordability Scheme showed the value of targeted financial incentives in encouraging affordable housing. This scheme, available to private and disproved investors, generated positive outcomes for tenants. The benefits included better health for low-income tenants who were able to moved into quality new housing. A <a href="https://cityfutures.ada.unsw.edu.au/documents/81/Next_moves_report.pdf">raft</a> of <a href="https://apo.org.au/node/260431">evaluations</a> have <a href="https://www.ahuri.edu.au/research/final-reports/267">demonstrated</a> the achievements of this scheme. <h2>Crisis calls for lasting solutions</h2> Short-term measures such as rent caps or eviction bans will not provide a solution in the near future or even the medium or long term. Instead, these are likely to worsen both the housing costs and health of low-income tenants. Reform focused on ongoing needs is called for. Solutions that can be implemented quickly include the tighter targeting of negative gearing and the introduction of a low-income housing tax credit. Talking about change, as the national cabinet is doing, will begin that process of transformation, but it must be backed up by a range of measures to boost the supply of affordable housing. This, in turn, will improve the housing market overall as affordable options become more widely available.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/211275/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, Executive Dean, UniSA Business, <a href="https://theconversation.com/institutions/university-of-south-australia-1180">University of South Australia</a> and <a href="https://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>, Professor of Housing Research, <a href="https://theconversation.com/institutions/university-of-adelaide-1119">University of Adelaide</a> Image credits: Getty Images This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/the-rental-housing-crisis-is-hurting-our-most-vulnerable-and-demands-a-range-of-solutions-but-capping-rents-isnt-one-of-them-211275">original article</a>.

Real Estate

Room to Move: Desperate renters forced into backyard boxes

Victorian tenants have taken desperate measures in their hunt for a home in the midst of a housing crisis, turning to portable rooms set up in their parent’s driveways and backyards. The portables - described as ‘stand-alone separate rooms’ - have been seen across Facebook Marketplace for up to $180 per week, in a time when Melbourne’s median rent has reached $460 each week. The company behind the Room to Move initiative have advertised a 7.2sq m room for $150 per week, and for those seeking a little more wiggle room, a 10.1sq m room is available for $180. However, a minimum hire period of six months applies to both, as well as a bond of $500, and a one-month written notice to end the lease. And for anyone just outside of Melbourne who might be interested, the rooms can be delivered within a three-to-four hour drive from the city - for a fee of $250. The spaces don’t come with bathrooms, but do feature weatherproof electrical sockets that power two double power points, two internal downlights, and a reverse cycle air conditioner. “There’s plenty of demand for people looking for a short term solution for accommodation,” Room to Move co-founder Nick Nottle said of the decision to launch the spaces. “Typically people place [the rooms] in their backyard or on their driveway back off the street a bit.” He noted that the spaces attracted the most attention from renters who were moving back in with family in a bid to save enough for their own house deposit, and that he and business partner Mike Rose launched Room to Move when they noticed a gap in the market, and saw an opportunity for portables that weren’t an eyesore in a residential environment. “Neighbours don’t really complain because people like the look of it,” he said, “it doesn’t look like you’ve just dropped a big shipping container in your backyard.” Beyond desperate renters, however, Nick believes the ‘properties’ also appeal to parents who want something self-contained to get their teenagers out of their hair, as well as having somewhere to house visitors coming from a long way away. And last but not least, according to Nick, “the other group is people using them as an office to work from home, or for studio-type businesses like a lash salon, tattoo parlour or hairdresser - things you can do from home rather than renting a space elsewhere.” Images: Facebook, realestate.com.au

Real Estate

House with "free" rent listed with major catch

A dilapidated house has been leased for free, offering prospective tenants 12 months of free housing. However, the three bedroom house in south-west Sydney must undergo a full renovation before anyone can move in. Originally posted on Domain, the house has been deemed "currently uninhabitable", with the listing quickly going viral before being taken down. The listing read, “3 bedroom family home perfect for the growing family, nestled in a quiet yet convenient location being close to all the wonderful amenities such as transport, parks, schools, shops in need of a renovation.” Hidden deep within the listing was the information that the house is not currently fit for anyone to live in, with the tenants being expected to front the cost of the entire renovation. “Property is currently uninhabitable - work is required before moving in. The landlord does not have the funds to renovate the property,” the listing said. The listing agent described it as an opportunity for a “savvy minded person or persons with trade knowledge and experience”. The successful tenant will be required to pay for the “full renovation at their own expense”, and in return will receive a three-year lease at the property with the first year coming with no charge. However, they will then need to pay for the second and third years of their lease, with the rent "negotiable" at $650 a week. The listing quickly went viral, with commenters calling out the landlord's "audacity" to ask such a task of a renter that only receives one year of free housing for all their hard work. “Next they will tell you to build a house which you can then rent back,” one person said. “Wow. Just when you thought the audacity was at its most audacious,” another person commented. On Reddit, commentators also pointed out the new tenant would need to spend thousands on the renovation, making the one year of free rent basically worthless. "What a steal. Instead of paying $33,800 a year (the $650 they want after the first year) you get to spend 100-200k+," someone said. "If the landlord is tight on money and doesn't have the funds to renovate, they should just sell the place," another commented. Image credits: Domain

Real Estate

Artist puts the lid on rubbish rental prices

In the age of soaring interest rates and a global housing crisis, one young man in the United Kingdom had a wheelie good idea for getting a roof over his head. His solution? Skipping the queues, and moving into a bin. British artist and architect Harrison Marshall was down in the dumpsters when he decided to seize the opportunity, to both raise awareness about those being forced from their homes due to extortionate rent prices in London - and give himself somewhere to stay in the process - by converting an old skip into a tiny home. The Skip House boasts a whole range of features that one might not expect to find in a place so small - 25 square metres, in fact - with the likes of insulted timber framing, a barrel roof capable of fitting a bed, a kitchen hob - the whole set up including a sink, a stove, and a tiny fridge - as well as a wardrobe. And although it took a month since Marshall moved himself in, the skip was eventually connected to the grid, allowing him to warm his tiny property. The home doesn’t have its own flushing toilet or even a shower, but it doesn’t phase Marshall, who makes use of such amenities at work or at the gym. <blockquote class="instagram-media" style="background: #FFF; border: 0; border-radius: 3px; box-shadow: 0 0 1px 0 rgba(0,0,0,0.5),0 1px 10px 0 rgba(0,0,0,0.15); margin: 1px; max-width: 540px; min-width: 326px; padding: 0; width: calc(100% - 2px);" data-instgrm-captioned="" data-instgrm-permalink="https://www.instagram.com/reel/Co22dZwoxaQ/?utm_source=ig_embed&utm_campaign=loading" data-instgrm-version="14"> <div style="padding: 16px;"> <div style="display: flex; flex-direction: row; align-items: center;"> <div style="background-color: #f4f4f4; border-radius: 50%; flex-grow: 0; height: 40px; margin-right: 14px; width: 40px;"> </div> <div style="display: flex; flex-direction: column; flex-grow: 1; justify-content: center;"> <div style="background-color: #f4f4f4; border-radius: 4px; flex-grow: 0; height: 14px; margin-bottom: 6px; width: 100px;"> </div> <div style="background-color: #f4f4f4; border-radius: 4px; flex-grow: 0; height: 14px; width: 60px;"> </div> </div> </div> <div style="padding: 19% 0;"> </div> <div style="display: block; height: 50px; margin: 0 auto 12px; width: 50px;"> </div> <div style="padding-top: 8px;"> <div style="color: #3897f0; font-family: Arial,sans-serif; font-size: 14px; font-style: normal; font-weight: 550; line-height: 18px;">View this post on Instagram</div> </div> <div style="padding: 12.5% 0;"> </div> <div style="display: flex; flex-direction: row; margin-bottom: 14px; align-items: center;"> <div> <div style="background-color: #f4f4f4; border-radius: 50%; height: 12.5px; width: 12.5px; transform: translateX(0px) translateY(7px);"> </div> <div style="background-color: #f4f4f4; height: 12.5px; transform: rotate(-45deg) translateX(3px) translateY(1px); width: 12.5px; flex-grow: 0; margin-right: 14px; margin-left: 2px;"> </div> <div style="background-color: #f4f4f4; border-radius: 50%; height: 12.5px; width: 12.5px; transform: translateX(9px) translateY(-18px);"> </div> </div> <div style="margin-left: 8px;"> <div style="background-color: #f4f4f4; border-radius: 50%; flex-grow: 0; height: 20px; width: 20px;"> </div> <div style="width: 0; height: 0; border-top: 2px solid transparent; border-left: 6px solid #f4f4f4; border-bottom: 2px solid transparent; transform: translateX(16px) translateY(-4px) rotate(30deg);"> </div> </div> <div style="margin-left: auto;"> <div style="width: 0px; border-top: 8px solid #F4F4F4; border-right: 8px solid transparent; transform: translateY(16px);"> </div> <div style="background-color: #f4f4f4; flex-grow: 0; height: 12px; width: 16px; transform: translateY(-4px);"> </div> <div style="width: 0; height: 0; border-top: 8px solid #F4F4F4; border-left: 8px solid transparent; transform: translateY(-4px) translateX(8px);"> </div> </div> </div> <div style="display: flex; flex-direction: column; flex-grow: 1; justify-content: center; margin-bottom: 24px;"> <div style="background-color: #f4f4f4; border-radius: 4px; flex-grow: 0; height: 14px; margin-bottom: 6px; width: 224px;"> </div> <div style="background-color: #f4f4f4; border-radius: 4px; flex-grow: 0; height: 14px; width: 144px;"> </div> </div> <p style="color: #c9c8cd; font-family: Arial,sans-serif; font-size: 14px; line-height: 17px; margin-bottom: 0; margin-top: 8px; overflow: hidden; padding: 8px 0 7px; text-align: center; text-overflow: ellipsis; white-space: nowrap;"><a style="color: #c9c8cd; font-family: Arial,sans-serif; font-size: 14px; font-style: normal; font-weight: normal; line-height: 17px; text-decoration: none;" href="https://www.instagram.com/reel/Co22dZwoxaQ/?utm_source=ig_embed&utm_campaign=loading" target="_blank" rel="noopener">A post shared by SKIP House (@theskiphouse)</a> </div> </blockquote> “With the cost of living at an all time high, and no end in sight, this project is about living for less,” Marshall said of the project on the Skip House’s Instagram, “in one of the most expensive cities in the world, London. “People across the country are changing the way they live to compensate for the rising cost of basic necessities,” he continued. “Living in a skip isn’t the solution, but rather an exploration and a statement.” As Marshall, who now pays approximately $90 a week in rent, told Southwark News, “it seems crazy that people work in the city and can’t afford to live here. Or [that] people who have lived here their whole lives can’t afford to stay here, so they’re having to move out.” He explained that constructing the tiny home was “the only way” for him to continue to live there, and that he hoped to spark a conversation around housing, particularly when it came to unused urban wasteland spots, and how more creative solutions had to be out there. “It also gave quite a good juxtaposition between what you don’t typically think of as a house and almost the polar opposite of that, which is a bin or dumpster,” Marshall told Business Insider, “and how actually that could be turned into something which is relatively cosy and homely.” And as for what his neighbours think about his unusual housing venture, he told Southwark News that he had between 20 and 25 of them show up to his skip-warming, “they’re all super supportive. “People have even seen me doing stuff in the garden and gone to get their tools and come to help out and people around have filled up my hot water bottle.” Images: Instagram

Landlord rents out balcony for $300 a week

As the housing crisis in Australia continues, one landlord has decided to capitalise on the desperation of renters by leasing a balcony for $300 a week in a bizarre listing. The landlord shared the “room” on Facebook, sharing photos of the enclosed balcony with city views, obscured by tarps and heavy curtains, along with a peculiar list of questions for prospective tenants. “Man Private Room Sydney Cbd. 1 boy only. $300/week,” the ad read. “Quick response 04******** Please kindly send me your information.” The ad then prompts tenants to list what items they will be bringing into the apartment, before the landlord asks applicants to provide their nationality. The balcony room is in Haymarket’s Miramar building in the Sydney CBD, although any views of the city skyline have been obstructed with silver tarpaulin, while the glass sliding doors leading to the actual apartment were concealed by blue curtains. A blue single mattress has been squeezed into one corner of the balcony room, opposite a small desk and TV, with both walls adorned with tropical-themed art. When the landlord was contacted on the phone by news.com.au, they answered several questions before refusing to speak further with a female journalist. He said he had received “a lot of interest” and several calls about the property, though wouldn’t specify how many people had been in touch. A three-bed, two-bath unit in the building sold for $1.15 million in September last year, while the estimated rental income for a two-bed, one-bath unit is $810 per week. Even a parking space in the Miramar can be rented out for $650 a month. The listing comes amid unprecedented pressure on the Sydney rental market, with record-low vacancy rates pushing prices sky-high. The median rent for a house in Sydney reached a record high of $650 per week at the start of the year, while the median rent for a unit was also at a high of $550. Tenants have little choice but to pay up, with the national vacancy rate at just 0.9 per cent. Image credits: Facebook

Real Estate

How much it costs to rent Hugh Jackman’s bucket list home

After building and developing this stunning, minimalist East Hamptons estate over a period of six years, Wolverine star Hugh Jackman and his wife Deborra-lee Furness have decided to put it to better use by popping it onto the rental market – and it will only set you back around half-a-million dollars per month, according to <a href="https://www.corcoran.com/listing/for-rent/20-hedges-banks-drive-east-hampton-ny-11937/6517169/regionId/3" target="_blank" rel="noopener">Corcoran.com</a>. “Stunning Modern Waterfront Compound!” screams the listing. “Beautifully done, highest end construction, with every amenity, including gym, theater, flush edge pool, jacuzzi, and two single and separate homes, set high on the bluff overlooking the open bay with the most spectacular views!” After Hugh bought the property for $3.5m in 2015, he and Deborra-lee spent six long years renovating it, and turning it into what Furness described as her “lifelong dream”. Architect Stelle Lomont Rouhani collaborated with Jackman and Furness to create “the utmost Zen tranquillity overlooking the Gardiner's Bay in East Hampton”. The minimalist main house with a gourmet kitchen, Gaggenau appliances and an informal dining room features a hand-carved solid bleached walnut dining table, custom crafted by Field & Co., 3 en suite bedrooms, floor-to-ceiling glass doors, and a guest house, meticulously renovated and features open living space complete with a top-of-the-line kitchen with bar area, a step-down open living room with lounge-style seating, along with a loft bed and lounge areas and a primary suite overlooking the oversized pool and spa sitting above the bay with a spectacular 180-degree vista of the water. Set on a sprawling 2.5-acre plot, the 5-bedroom, 5 1/2 bath compound is the ultimate retreat with all the amenities of a 5-star resort. Images: Corcoran.com

Real Estate

Calls to protect rights of tenants with animals

Amid the current cost-of-living crisis and housing crisis, renters across Australia and New Zealand are finding it harder to secure homes to rent - but it’s even harder for renters with pets. In parts of Australia, landlords are legally protected if they refuse applications from tenants with companion animals, while New Zealand rentals can still refuse to have pets as well. Dr Zoei Sutton, an academic at Flinders University in South Australia, conducted a study involving in-depth interviews with tenants and stakeholders, including landlords, and found that many were struggling to obtain a rental when they had pets. “My study shows Australian landlords and property managers are particularly reluctant to house cats, as they’re seen as leaving allergy hazards or the need for deep cleaning of carpets. Owners of bigger dogs and certain breeds can also have a harder time finding housing,” she said. “And while we’re starting to see legislative shifts in Victoria and NSW, legislation to protect pet owners has been defeated in South Australia.” During the interviews, Dr Sutton also uncovered several strategies renters could use to improve their chances of success, including preparing pet ‘resumes’ for agents and landlords. “Both tenants and stakeholders agreed that there needs to be an understanding that rental houses are homes. This means working with both landlords and tenants to make sure everyone has a clear understanding of what fair ‘wear and tear’ is,” she added. While interviewing tenants, landlords, real estate agents, and emergency housing organisations in SA, she heard multiple stories of renters experiencing a “constant source of worry” while renting. “One tenant reported finding just ten potential properties listed as pet friendly while another family found only two within their price range. Some tenants are being asked to pay higher rent to secure a house,” Dr Sutton said. “Multiple participants reported that there was a bidding war for houses with some tenants offering 3 or 6 months rent in advance, just to secure a house. “One family had fallen through the damaged floor of their house multiple times but were reluctant to report the landlord’s failure to maintain the home because this might result in a bad reference when they next had to move.” “It’s a constant source of worry, knowing that your lease might not be renewed or your house might be sold and you’ll have to try to find something again.” Meanwhile, New Zealand journalist Charlotte Muru-Lanning <a href="https://thespinoff.co.nz/society/28-09-2022/the-absence-of-rights-for-renters-with-pets-is-just-cruel" target="_blank" rel="noopener">reported</a> in September that 14 percent of rentals available across the country were listed as “pets OK”, despite nearly half of New Zealand households. “We need more protections for tenants so they can report unfair housing conditions without jeopardising future housing,” Sutton said. “Animals need to be able to use the home too, and there are small things you can do to minimise any potential damage. “Property managers have a key role in educating landlords and tenants to ensure everyone is happy and has reasonable expectations.” Image: Getty Images

Real Estate

Aussie man faces sky-high rent for “rotten” home

As the cost-of-living and housing crisis collide, it has left many Aussie renters living in poor conditions while paying an increasing amount to do so. For Jarod, who wished for his surname not to be used, this has meant experiencing multiple rental increases over the past couple of years, all while living in a home without heating or cooling that is “falling down”. The 51-year-old lives in Hobart, one of the country’s least affordable cities, and has gone from paying $450 a week back in 2020 to a hefty $540 now, with another jump expected to hit in the coming months that he is estimating will be upwards of $600. As a result of the skyrocketing rent, he has been forced to share the rental with a friend since it is “impossible” for him to live alone. “It’s set a precedent for greedy landlords and you think you are paying a lot of rent so you would get good services but this house is rotten and it’s falling down,” he told <a href="https://www.news.com.au/finance/real-estate/renting/impossible-rental-crisis-reveals-unaffordable-homes-across-australia/news-story/9037cc4ad2bd91b8c34cd03f176f032a" target="_blank" rel="noopener">news.com.au</a>. “The bathroom is falling into the floor, there is no heating and no cooling and this is a 200-year-old house that is basically in original condition. “But that’s not uncommon. I have looked at a lot of viewings and you see a really bad kitchen with no working oven and no heating and they still want top dollar and are not willing to budge to do any renovations.” The semi-retired antique dealer is also taking part in a project with Everyday’s Home, an affordability campaign group, by measuring the temperatures in his home. He told the outlet that one of his rooms measured at 41C recently despite the peak of summer still to come. Having moved to Tasmania in 2008, Jarod said he was easily able to find affordable rentals until 2016, with the recent exodus of people from Sydney and Brisbane making things even worse. “It’s causing strain on relationships with other people, like the other person I live with and my family and I’ve had to ask my family for money over the recent period as I’m struggling financially,” he said. “I have started to look but I don’t drive so I have had to look out in the remote areas and they are just really difficult with transport and getting around and getting to basic stuff like the shops. “Then you’re sacrificing your lifestyle and things like the shops and day-to-day activities that you would normally do. It’s just a really anxiety-ridden process. “I have been trying to find somewhere else but it’s really difficult as there is no stock available for the people looking as well, so you go to somewhere for example and there will be hundred people there.” Jarod’s story comes as a new rental affordability report from SGS Economics and National Shelter found that 40 percent of low-income households are experiencing rental stress, as well as struggling to pay for food, heating, and healthcare. In comparison, only 35 percent of low-income households were experiencing rental stress in 2008. The housing crisis has affected renters across the country, with historic lows in affordability being recorded in Brisbane, Perth and Sydney. Ellen White, the lead author of the report, said the rental crisis had spread to regional areas following the pandemic, with the recent floods also having an impact. National Shelter CEO Emma Greenhalgh has called for rental reform to help curb the rental crisis and stop the rise in homelessness and housing stress. “We need rental reform that includes limiting rent increases and adjustments to income support including Commonwealth Rent Assistance,” she said. “We also need greater investment in social and affordable housing to reverse a decade-long decline.” Images: news.com.au

Real Estate

Do tenancy reforms to protect renters cause landlords to exit the market?

More Australians are <a href="https://theconversation.com/wealthy-landlords-and-more-sharehousing-how-the-rental-sector-is-changing-94394">renting their housing longer</a> than in the past. But they have relatively little legal security against rent increases and evictions compared to <a href="https://theconversation.com/what-australia-can-learn-from-overseas-about-the-future-of-rental-housing-90401">tenants in other countries</a>. When state governments suggest stronger protections for tenants, landlords and real estate agents <a href="https://www.reiq.com/articles/reiq-concerned-rental-reforms-unravel-rights-of-property-owners/">claim it will cause disinvestment</a> from the sector, increasing pressure on already tight rental markets. In <a href="https://www.ahuri.edu.au/research/final-reports/391">research</a> for the Australian Housing and Urban Research Institute (<a href="https://www.ahuri.edu.au/about">AHURI</a>), published today, we put the “disinvestment” claim to the test. We looked at the impacts of tenancy reforms in New South Wales and Victoria on rental property records over 20 years, as well as surveying hundreds of property investors. We found no evidence to support this claim. We did find a high rate of turnover as properties enter and leave the sector. This happened regardless of tenancy law reforms. It’s a major cause of the unsettled nature of private rental housing for tenants. We suggest that if substantial tenancy reforms did cause less committed landlords to exit the sector, that might not be a bad thing. <blockquote class="twitter-tweet"> A tenancy law expert says it could be illegal in several states, while tenants’ advocates say it preys on vulnerable renters during Australia’s housing crisis. <a href="https://t.co/hQEdS80a3h">https://t.co/hQEdS80a3h</a> (via <a href="https://twitter.com/abcnews?ref_src=twsrc%5Etfw">@abcnews</a>) — ABC Australia (@ABCaustralia) <a href="https://twitter.com/ABCaustralia/status/1587927668846399488?ref_src=twsrc%5Etfw">November 2, 2022</a></blockquote> How did we test the disinvestment claim? We analysed records of all rental bond lodgements and refunds in Sydney and Melbourne from 2000 to 2020. From these records we can see properties entering the rental sector for the first time (investment) and exiting the sector (disinvestment). We looked for changes in trends in property entries and exits around two law reform episodes: when the 2010 NSW Residential Tenancies Act took effect, and the start of a tenancy law reform review in Victoria in 2015. We found no evidence the NSW reforms affected property entries (investment). And property exits (disinvestment) were slightly reduced – that is, fewer properties exited than expected. In Victoria, we found property entries reduced slightly when the law reform review started – perhaps a sign of investors pausing for “due diligence”. We saw no effect on property exits. So in neither state did we find evidence of a disinvestment effect. We also surveyed 970 current and previous property investors, and got a similar picture. When deciding to invest, investors said prospective rental income and capital gains were the most important considerations, but tenancy laws were important too. On the other hand, tenancy laws were the least-cited reason for disposing of properties. Many more investors said they did it because they judged it a good time to sell and realise gains, or they wanted money for other purposes, or because the investment was not paying as they had hoped. A state of constant churn Our research also gives new insights into the private rental sector, which <a href="https://www.housingdata.gov.au/">has been growing</a> relative to owner-occupied and social housing. Small-holding “mum and dad” landlords dominate the sector. Some 70% of landlords own a single property. Multiple-property owners own more properties in total, but still relatively small numbers (rarely more than ten) compared to corporate landlords in other countries who have tens of thousands of properties, or even more. Australia now has some large corporate landlords, but their properties are a tiny fraction of the total rental stock. Beneath its gradual growth and persistent small-holding pattern, the private rental sector is dynamic. Properties enter and exit the sector very frequently. In both Sydney and Melbourne, our analysis shows, most properties exit within five years of entering. <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=307&fit=crop&dpr=1 600w, https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=307&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=307&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=385&fit=crop&dpr=1 754w, https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=385&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/496048/original/file-20221118-13-8fazlx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=385&fit=crop&dpr=3 2262w" alt="Chart showing private rental properties, Sydney and Melbourne, 2000–20, by year of first observation in rental bonds data and at five-year intervals" /></a><figcaption>Numbers of private rental properties in Sydney and Melbourne at five-year intervals from 2000 to 2020. Properties are categorised by year of first observation in rental bonds data. The authors</figcaption></figure> More than 30% of tenancies begin in a property that’s new to the rental sector. And more than 25% of tenancy terminations happen when the property exits the sector. Our investor survey also shows the sector’s dynamism. Many investors made repeated investments, owning multiple properties and some interstate. They indicated strong interest in <a href="https://theconversation.com/ever-wondered-how-many-airbnbs-australia-has-and-where-they-all-are-we-have-the-answers-129003">short-term letting</a>, such as Airbnb, and significant minorities had used their properties for purposes other than rental housing. Australia’s rental housing interacts closely with other sectors, particularly owner-occupied housing, as houses and strata-titled apartments trade between the sectors. The tax-subsidised property prices paid by owner-occupiers heavily influence investors’ gains and decision-making. Rental is also increasingly integrated with tourism, through governments’ <a href="https://theconversation.com/who-wins-and-who-loses-when-platforms-like-airbnb-disrupt-housing-and-how-do-you-regulate-it-106234">permissive approach to short-term letting</a>. In short, the Australian rental sector is built for investing and disinvesting. As properties churn in and out of rental, renters are churned in and out of housing. This presents problems for tenants. A new agenda for tenancy law reform Australian residential tenancies law has accommodated the long-term growth of the rental sector and its dynamic character. With no licensing or training requirements, it’s easy for landlords to enter the sector. It’s also easy to exit by terminating tenancies, on grounds they want to use a property for other purposes, or even without grounds in many cases. Over the years tenancy law reform has fixed some problem areas, but with virtually no national co-ordination. Laws are increasingly inconsistent on important topics, such as tenants’ security (for example, some states have restricted, but not eliminated, no-grounds terminations), minimum standards and domestic violence. Reforms have overlooked significant problem areas, such as steep rent increases and landlords’ liability for defective premises. <blockquote class="twitter-tweet"> Works for Australia too. Although don't even need to pretend to put it on the market in NSW, it's called a "no grounds eviction" or perhaps more accurately: "tenant expected a liveable home or repairs to broken stuff". <a href="https://t.co/GolGDqlyCu">https://t.co/GolGDqlyCu</a> <a href="https://t.co/wORI3K6Yap">pic.twitter.com/wORI3K6Yap</a> — Nathan Lee (@NathanLee) <a href="https://twitter.com/NathanLee/status/1542298797039964160?ref_src=twsrc%5Etfw">June 30, 2022</a></blockquote> It is time to pursue a national agenda that goes further than previous limited reforms. The focus should be on the rights of tenants to affordable housing, in decent condition, that supports autonomy and secure occupancy. Where landlords say it is too difficult and they will disinvest, this should not be taken as a threat. Indeed, it would be a good thing if the speculative, incapable and unwilling investors exited the sector. This would make properties available for new owner-occupiers and open up prospects for other, more committed landlords, especially non-profit providers of rental housing. Similarly, if we had higher standards and expectations to discourage private landlords from entering the sector, that would open up scope for new owner-occupiers and investors who are less inclined to churn properties and households. While past tenancy law reforms have not caused disinvestment, maybe the next reforms should. <hr /> The authors acknowledge the contributions of their research co-authors, Professor Kath Hulse, Professor Eileen O’Brien Webb, Dr Laura Crommelin and Liss Ralston.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/194900/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> Writen by Chris Martin, Milad Ghasri, Sharon Parkinson and Zoe Goodall. Republished with permission from <a href="https://theconversation.com/do-tenancy-reforms-to-protect-renters-cause-landlords-to-exit-the-market-no-but-maybe-they-should-194900" target="_blank" rel="noopener">The Conversation</a>. Image: Getty Images

Real Estate

Leaked email advises landlords to increase rent amid housing crisis

A real estate agency in Brisbane has come under fire over a leaked email in which landlords were advised to consider raising rents by more than 20 percent amid Australia’s worsening rental crisis. The email, sent by Ray White East End, asked landlords to consider whether their properties were being “under-rented” and advised them to increase rents by “above 20 percent” - more than double the rate of inflation - with potential earnings of an extra $10,000 a year. “Our property managers have been reviewing all our lease renewals and on average recommending a 17% rent increase on the leases renewed in October & November this year,” the email said, per <a href="https://www.theguardian.com/australia-news/2022/oct/17/brisbane-real-estate-agency-advises-landlords-to-increase-rents-by-over-20-amid-housing-crisis" target="_blank" rel="noopener">The Guardian</a>. “As we are planning December lease renewals, the average lease renewal recommendation is above 20%. This can be as much as $10,000 per year in additional rental income.” The agency said that “many landlords are not being provided with the information to make an informed decision” about rent increases, claiming that landlords were being advised to sign long-term leases with increases of $5 to $20 a week. The email also said that most tenants “are agreeable” to the increases and would understand that it is “fair and reasonable” based on what is available on the market. “On average, apartments in West End/Highgate Hill/South Brisbane/Brisbane CBD are renting for one bedroom $480 to $520+ [a week and for] two bedrooms $675 to $850+ [a week],” the email said. “If you are not achieving these rents (at a minimum), you should be asking why?” It comes as the Queenlsand government prepares to hold a housing summit to address rising homlessness and rental stress across the state. Penny Carr, the chief executive at advocacy organisation Tenants Queensland, said the email was an example of “opportunistic price-gouging” that is happening across Australia at the moment. “Rents are unaffordable for people at the moment and tenants are having to absorb increases because of fear of not finding another property or becoming homeless,” she said. “We should only allow rent increases above CPI if they’re justifiable and there’s been major work to the property or something’s had to be replaced.” Ms Carr said rent increases have been due to vacancy rates and supply and demand, and that the email dispels the myth that a land tax proposed by the government last year for interstate investors is to blame. Meanwhile, Ray White East End principal realtor Luke O’Kelly said rental affordability relies on investors. “Over the past 12 months, Brisbane has had some of the strongest population growth in the country and this has most clearly shown up in rental growth,” Mr O’Kelly said. “Right now, Brisbane doesn’t have enough homes for those that want to live here … with rents rising so quickly, Brisbane needs more property investors.” Fiona Caniglia, executive director of not-for-profit housing and homelessness organisation Q Shelter, said the timing of the email couldn’t be worse. “It is disappointing to hear this the week of the emergency housing summit to be honest,” she told <a href="https://www.news.com.au/finance/real-estate/renting/dont-have-enough-homes-rental-agency-ray-white-tries-to-increase-rent-by-20-per-cent/news-story/e4ff2ab4807fffe3b50b90fe81069156" target="_blank" rel="noopener">news.com.au</a>. “We already know that many vulnerable Queenslanders are struggling to secure a rental property in the first place.” “There are record numbers of people showing up for the small number of properties listed right across Queensland. Such an increase will only benefit those on higher incomes and will of course again negatively affect vulnerable Queenslanders, forcing more people into homelessness.” Ray White’s chief economist Nerida Conisbee defended the email in a statement shared with the outlet, saying that the market is currently ideal for investors. “Right now, Brisbane doesn’t have enough homes for those that want to live here,” she said. “This is making it tough for renters but does make it a good place to invest. While red hot house price growth is unlikely to start up again in the near future, yields are increasing as rents rise.” With Australians paying an extra $7.1 billion in rent over the past year and the average renter spending $62 more a week than this time last year, Greens housing and homelessness spokesperson Max Chandler-Mather said the email showed that urgent action is needed. “It’s this sort of flagrant price-gouging that demonstrates exactly why we need a national two-year freeze on rent increases,” he said. Image: Getty Images

Real Estate

5 things to do before renting to family or friends

Home owner Lisa wishes she had never agreed to rent out her Sydney investment property to a friend. The decision to offer her two-bedroom flat to a friend who was looking for a pet-friendly place to stay after splitting from her husband has taken its toll on their relationship and left the pair barely speaking. “I always said I wouldn’t rent to friends and I wish I hadn’t,” the Sydneysider told Domain. “It makes everything a lot more complex and harder to do the normal things you need to do to keep an investment property sustainable financially.” “When things go wrong, it’s very hard to tell them that they can’t do that or they need to change what they are doing,” she said. Lisa self-manages the flat which she has been renting to her friend at market rate for one year and tried to address her concerns about renting to a friend with extra detailed points on the tenancy agreement. “She still complains about every little thing that is no problem at all,” Lisa said. “The cons (of renting to a friend) is that they think they are special and will get special treatment; also they may contact you often regarding things that are not of your concern (as a landlord), seeking help as a friend. “Simply don’t do it,” was her advice to others considering renting to family or friends. L.J. Hooker’s head of property investment management Amy Sanderson said the key to renting to family or friends was setting clear guidelines before they moved in. She said that apart from signing a formal tenancy agreement, the parties should have an upfront discussion about boundaries and the level of contact they will have and their responsibilities for the property’s bills and maintenance. “When it works out, it absolutely does have benefits … a home is a really big financial commitment, so to have a complete stranger in there can be quite nerve-racking; to have someone you know in there, can be a big relief and really nice,” she said. “Also to be able to give a family member a roof over their head and some sort of stability is lovely – while everything is good, it’s great; but when it’s bad, it goes really bad.” Ms Sanderson said it could be challenging to avoid getting emotionally involved and doing yourself a financial disservice by making concessions for your tenant, such as letting them pay you back for rent. “If it gets awkward or to a point that someone is not abiding by the lease agreement, you need to be comfortable to stand up and have those conversations. If you’re not, you should give it to an agent.” McGrath leasing team leader James Lovell agreed and noted disagreements could be hard to resolve without a property manager. <img src="../media/36304/image__498x245.jpg" alt="Image_ (256)" width="498" height="245" /> “There is the chance that either the landlord or tenant will not hold up their responsibility, whether the landlord is not getting the repairs done or the tenant is not paying rent … when you have a relationship with them, the conflict can be more difficult to handle; you’re probably not looking at it just through the eyes of the law. “If you are going to self manage, keep yourself covered and reference everything you do, quite often; especially between family and friends, things can be said and not documented.” Lovell said that if landlords did their due diligence there was no reason the arrangement couldn’t work out well for both. Luke, from Shoalhaven, who has been renting out an investment property to his parents at slightly below market rate for about six years, said it was nice to be able to have a tenant you knew would respect your property. “My parents know this property will become something used to support us when we retire, so they are always making sure they take care of it. Some tenants just don’t think about having grease on their shoes and walking it over the carpet, or moving thier furniture over the lino or floor boards and ripping or scratching it up – they just think it’s wear and tear the landlord can deal with.” He said he and his partner would always be willing to rent to selected family members. “We have refused to rent to some family who drink heavily or have previously been evicted from places for damaging it or not paying rent … we were very close when I was a kid, but at the end of the day, these are investment properties, not charity, and you have to be willing to turn off the heart and work only from the brain. “If it’s the right fit though it works for both sides. I think they see the positives we offer them – slightly cheaper rent if we can afford it and we regularly maintain the property and make sure it’s comfortable for them, and they offer us the security of having a long-term tenant and a respectful tenant and it means that we don’t have to pay an agent to manage our property.” Five things you should do if renting to family or friends: <ol> <li>Do a detailed property inspection and take them through it – don’t skip this step just because you know them.</li> <li>Complete a tenancy agreement.</li> <li>Set contact boundaries – can they call you whenever they like, can you drop in for a cuppa whenever you like or will you have more of a traditional landlord-tenant relationship?</li> <li>Determine what bills you will pay and what bills the tenant will pay.</li> <li>Discuss each person’s responsibility for the maintenance of the property to ensure no one is under the wrong impression.</li> </ol> Have you ever rented to family or friends? Written by Kate Burke. First appeared on <a href="http://www.domain.com.au" target="_blank" rel="noopener">Domain.com.au</a>. Image: Getty

Legal

Rent crisis? Average rents are increasing less than you might think

You wouldn’t know it from the pages of our daily newspapers, but the rate of growth in rents has been pretty modest. Not everywhere, not for everyone, but for most Australians who rent. According to the most recent count used by the Bureau of Statistics to compile the consumer price index, rents increased by only <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release#overview" target="_blank" rel="noopener">1.6%</a> in the year to June. By comparison, wages climbed <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/latest-release" target="_blank" rel="noopener">2.6%</a>. Higher increases in other prices pushed the overall consumer price index up <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release" target="_blank" rel="noopener">6.1%</a>. Rent decreases during COVID mean that over the past five years the total increase has been just 1.5%. Average rents are barely any higher than they were at the start of COVID. <hr /> <iframe id="GnFV0" class="tc-infographic-datawrapper" style="border: initial none initial;" src="https://datawrapper.dwcdn.net/GnFV0/2/" width="100%" height="400px" frameborder="0"></iframe> <hr /> The Bureau gets its data direct from the computers of real estate agents, state housing authorities and the Department of Defence (for Darwin). It covers rent actually paid, for a “<a href="https://www.abs.gov.au/statistics/detailed-methodology-information/concepts-sources-methods/consumer-price-index-concepts-sources-and-methods/2018/price-collection" target="_blank" rel="noopener">matched sample</a>” of dwellings, meaning it refers to the same dwellings each quarter so as to record genuine price changes. Actual versus advertised rents In contrast, the media (and some <a href="https://everybodyshome.com.au/resources/housing-criticalthe-role-of-housing-in-solving-critical-skill-shortages-across-the-regions/" target="_blank" rel="noopener">interest groups</a>) prefer to focus on the data for “advertised” or asking rents. These have been growing more strongly than the overall mass of rents paid. Nationwide, advertised rents climbed <a href="https://www.corelogic.com.au/news-research/news/2022/residential-rents-hit-record-highs-as-national-vacancy-rates-plummet" target="_blank" rel="noopener">8.2%</a> in the year to June, and by almost 18% over the five years to June on CoreLogic’s data. But advertised rents are only a tiny fraction of the rents actually paid. Not all properties get advertised. Advertised rents don’t always match up with the agreed rent. Most renters remain on existing contracts. Although advertised rents might be expected to relate to overall rents over time, they are not necessarily representative of the entire market. Our main concern ought to be what has happened to low-income renters. Low increases for low-income renters Australia’s lowest-income renters receive rent assistance, which is pretty frugal. Single renters get no more than <a href="https://www.servicesaustralia.gov.au/how-much-rent-assistance-you-can-get?context=22206" target="_blank" rel="noopener">$73 a week</a>, and very large families up to $97. But the typical rent paid by Australians on rent assistance hasn’t increased much. Over the year to June, the median rent for rent assistance recipients climbed by 1% – roughly $5 per week. Over the past five years it has increased 9% – somewhat less than the increase in the consumer price index of 10.7%. Over the longer term, low-income rents have increased more sharply. Households in the bottom 40% of income distribution used to spend around 22% of their after-tax income on rent, and now spend about 30%, down from a peak of 32%. <hr /> <iframe id="pRiMR" class="tc-infographic-datawrapper" style="border: initial none initial;" src="https://datawrapper.dwcdn.net/pRiMR/2/" width="100%" height="400px" frameborder="0"></iframe> <hr /> If there is a crisis in rents, the figures suggest it is not widespread. Rents in locations including Perth and Darwin are climbing much more strongly than others as they come off long periods of negative rent growth. The growth in asking rents is most pronounced away from the cities, in particular in holiday and tree-change destinations such as Richmond-Tweed (including Byron Bay), Gold Coast, Sunshine Coast and Wide Bay. Some were experiencing strong growth in asking rents before COVID, which accelerated through COVID. <hr /> <iframe id="JMbb7" class="tc-infographic-datawrapper" style="border: initial none initial;" src="https://datawrapper.dwcdn.net/JMbb7/2/" width="100%" height="400px" frameborder="0"></iframe> <hr /> Other regions, including parts of Sydney and Melbourne, have experienced subdued or <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release#overview" target="_blank" rel="noopener">negative</a> growth. Across all renting households we are yet to see any serious growth. To date, the “rent crisis” has been felt mainly in a few specific locations and among people looking for new rental properties.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/189154/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/ben-phillips-98866" target="_blank" rel="noopener">Ben Phillips</a>, Associate Professor, Centre for Social Research and Methods, Director, Centre for Economic Policy Research (CEPR), <a href="https://theconversation.com/institutions/australian-national-university-877" target="_blank" rel="noopener">Australian National University</a> This article is republished from <a href="https://theconversation.com" target="_blank" rel="noopener">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/rent-crisis-average-rents-are-increasing-less-than-you-might-think-189154" target="_blank" rel="noopener">original article</a>. Image: Getty Images

Money & Banking

Tiny “furnished” flat asks for eye-watering rent

While many might consider sacrificing some extra space in their home for a cheaper price, the landlords renting out this studio flat in London have gone the opposite direction and raised eyebrows for the interesting interior design choices. The one-bedroom, one-bathroom flat in Streatham, London, has been <a href="https://www.openrent.co.uk/property-to-rent/london/studio-flat-knollys-road-sw16/1460779" target="_blank" rel="noopener">listed</a> on UK site OpenRent for a hefty £1147 ($2204) a month. Though it appears quite ordinary from the outside and the listing details, things become stranger as you look through the interior photos provided. The furnished flat comes with a double bed, which has been shoved against the window and just a few footsteps away from the kitchen, including an oven, sink, bar fridge, and cabinets. The bathroom is just as bizarre, with the toilet located beneath a cut-out section of the wall and thin, rectangular mirrors above it and the single sink in the adjoining room. Despite being advertised as furnished, potential renters will need to source everything else to go with the bed and wooden cabinet provided. The interiors also feature grey walls, timber floorboards, and a slanted roof in the bedroom and kitchen area. The property has been available to rent since early August, with a minimum tenancy of one year and a maximum of two tenants. Images: OpenRent

Real Estate

Outrage after 1830s "slave cabin" listed for rent

Airbnb have copped an online slating after one of their listings, which was advertised as a bed and breakfast, was exposed as a former slave cabin. A user on TikTok found “The Panther Burn Cottage at Belmont Plantation” listing in Greenville, Mississippi, which was described as an “1830s slave cabin” and used as a “tenant sharecropper’s cabin”. The property was available to rent for $165 per night, and was slammed by TikTokker and lawyer Wynton Yates, who expressed his shock over the property saying it was anything but quaint and charming as described by some of its guests in reviews. “This is not OK in the least bit,” he said. “And I know there’s going to be someone saying ‘Oh you’re looking for controversy where it doesn’t exist.’ No." “This is an 1830s slave cabin up on Airbnb as a bed and breakfast." “They say it in the listing, ‘This particular structure, the Panther Burn Cabin, is an 1830s slave cabin from the extant Panther Burn Plantation to the south of Belmont.’" “How is this OK in someone’s mind to rent this out? A place where human beings were kept as slaves.” While the listing itself was alarming, what really concerned and infuriated Wynton was the reviews from previous guests. “We stayed in the sharecropper cabin and ate in the main house. The house tour was great and so was the breakfast,” one review read. “’We stayed in the cabin and it was a historic but elegant’ – a slave cabin is elegant?” a furious Wynton asked. “The history of slavery in this country is constantly denied and now it is being mocked by being turned into a luxurious vacation spot.” Wynton's video was viewed over 3 million times, which prompted Airbnb to remove the listing entirely. “Properties that formerly housed the enslaved have no place on Airbnb,” Airbnb said in a statement to <a title="www.usatoday.com" href="https://www.usatoday.com/story/travel/news/2022/08/01/airbnb-banning-former-slave-quarters/10209183002/" target="_blank" rel="noopener">USA Today</a>. “We apologise for any trauma or grief created by the presence of this listing, and others like it, and that we did not act sooner to address this issue.” The company said it’s working with experts on developing new policies for dealing with properties tied to slavery. Image credits: TikTok

Real Estate

Leonardo DiCaprio has listed his gorgeous $14 million mansion for rent

If you have some splash to cash you can now experience Leonardo DiCaprio being your landlord first hand by becoming his tenant. The award-winning actor dropped $US9.9 million ( $14 million) on a gorgeous 1930-era mansion in Beverly Hills late last year and has just listed the updated estate for rent. If you have $US32,500 ($48,000) per month to spare, you could very well be calling the Revenant star your landlord. DiCaprio stands out from other celebrity homeowners because he doesn’t offload his buys swiftly or flip the homes. In fact, “[he] has retained most of his purchases, turning his less frequented homes into rental properties,” Architectural Digest. The 464-square-metre immaculately updated home boasts four bedrooms, six bathrooms, a chef’s kitchen, white oak floors and sits on just over 1100-square-metres of prime Beverly Hills Flats real estate. The rental is fully furnished and available immediately. Serious applicants will also need a $US97,500 security deposit. The space is emboldened by black Marquina granite and white Carrara marble, and includes an adjacent breakfast nook with floor-to-ceiling French doors leading out to an al fresco dining terrace. Upstairs, three ensuite bedrooms include an impressive master retreat with impressive cathedral ceiling. The space boasts a mini-bar, walk-in closet and luxe marble bath equipped with a beautiful oval soaking tub. Other features of the estate include a substantial outdoor pool and a separate guesthouse with its own patio. The home is also shrouded behind prominent gates and established trees, providing a secluded oasis. DiCaprio picked up the arresting mansion for $US300,000 cheaper than its original $US10.2 million asking price.

Real Estate

If you’re renting, chances are your home is cold. With power prices soaring, here’s what you can do to keep warm

If you’re feeling the cold this winter, you’re not alone. About a quarter of all Australians have trouble keeping their homes warm enough in winter. That figure is likely to soar this year, due to poor quality housing and the rapidly escalating energy crisis. Renters are particularly at risk, but our research has shown many home owners are in the same boat as well. We’ve collected data over the last few years on how many Australians have cold homes, find it <a href="https://theconversation.com/forget-heatwaves-our-cold-houses-are-much-more-likely-to-kill-us-83030">difficult to stay warm</a>, and can’t afford their heating bills. What counts as cold? The World Health Organization recommends a <a href="https://www.who.int/publications/i/item/WHO-CED-PHE-18.10">minimum home temperature</a> of 18℃ for health and wellbeing. About a fifth of Australian renters, for example, <a href="https://doi.org/10.1038/s41597-022-01136-5">have cold homes</a>. Our <a href="https://able.adelaide.edu.au/housing-research/research/healthy-housing-cre/cold-in-australian-homes#0">current research</a> has shown this applies to home owners as well, with 26% of people across all housing types unable to stay warm at least half of the time during winter. Australia’s energy crisis is likely to see soaring rates of energy poverty, meaning being unable to keep your home warm or cool enough. Here’s why this is such a problem – and what you can do about it. <h2>Cold homes affect our health</h2> If you’re cold at home, you have a higher risk of developing <a href="https://link.springer.com/article/10.1007/s00484-017-1379-0">respiratory problems</a>and <a href="https://journals.lww.com/jhypertension/fulltext/2014/08000/Stronger_association_of_indoor_temperature_than.8.aspx?casa_token=TFv1eApy3hQAAAAA:9tc6eHiZCAk72mWgrmcgSxQT7kLczUDd7XNpXvNvoIFcMF6pJPSGpORK3SI-Veu4oc994saGXCWuJFBCs3pYN4g">high blood pressure</a>. People in the coldest homes face a higher risk of <a href="https://www.sciencedirect.com/science/article/pii/S0013935114003661?casa_token=vWpvR-oc8iMAAAAA:q72pW312N2oWIm1Gf9jpTTGUr3sH8uM_DankOAVzziVRT8_OPPnPjxJzDIC_x5j4Pr7O_Uuq">dying in winter</a>. Cold can have a flow-on impact on our health system, which is already struggling. Australia’s south-east has had the coldest start to winter <a href="https://thenewdaily.com.au/news/national/2022/06/09/cold-winter-weather-australia/">in decades</a>. Melbourne hasn’t been this cold this early since 1949, while Sydney hasn’t seen these temperatures in early June since 1989. <h2>Double trouble: cold weather and the energy crisis</h2> If you’ve been hit by the recent cold snap, chances are you’ll have been reminded how cold your home can get. This is not a surprise given how badly <a href="https://www.sustainability.vic.gov.au/research-data-and-insights/research/energy-efficiency-and-reducing-emissions/household-retrofit-trials">existing homes</a> and <a href="https://theconversation.com/australias-still-building-4-in-every-5-new-houses-to-no-more-than-the-minimum-energy-standard-118820">new housing</a> perform in keeping an even temperature. The cold has made many people doubly worried, because the energy required to heat our leaky, poorly insulated homes is about to get <a href="https://theconversation.com/expect-more-power-price-hikes-a-1970s-style-energy-shock-is-on-the-cards-183911">very expensive</a>. Early results from <a href="https://able.adelaide.edu.au/housing-research/research/healthy-housing-cre/cold-in-australian-homes#0">our survey</a> of over 350 Australians found 25% of people were experiencing shortages of money to the point they will be unable to adequately heat their homes. One third of our respondents said energy was unaffordable. Some reported making trade-offs, such as skimping on food or healthcare to pay energy bills. These people are experiencing energy poverty, where a household is unable to properly heat or cool their home or face significant financial difficulty doing so. While data about energy poverty in Australia is patchy, we know around 180,000 households <a href="https://vcoss.org.au/wp-content/uploads/2018/11/Persistent-Energy-Hardship-FINAL-Web-Single-Page.pdf">in Victoria</a> had persistent bill payment issues as of 2018, and 45,000 households were consistently unable to heat their homes. <h2>Energy price increases hit lower income households hardest</h2> Lower income households are more at risk from the cold. That’s because they’re more likely to live in homes that are in <a href="https://www.tandfonline.com/doi/full/10.1080/10852352.2016.1197714?casa_token=D_2YbBQ9wRkAAAAA%3A5Z_XqM42cmGunbSwhVJ-EaaHrtV4w3nORhDq9ZoaqAMBx700PldV7_9VVPdAWy7mm2hi3KYLOij3">poor condition</a> and hard to heat. One quarter of low income households told us they struggle to stay warm. Insulation may be a key factor, with 25% of our respondents reporting their rental properties did not have insulation. Insulation matters, because heat escapes homes through <a href="https://www.yourhome.gov.au/passive-design/glazing">single-pane windows</a>, or poorly insulated walls and ceilings. As a result, poorly insulated homes <a href="https://environmentvictoria.org.au/resource/10-tips-warm-house/">cost more to heat</a>. This makes life harder for low income renters, given they have little control over insulation or other home modifications. Worse still, heaters that are cheap to buy are often the most <a href="https://www.climatecouncil.org.au/top-tips-improve-home-energy-efficiency/#:%7E:text=Shoot%20for%20the%20stars%3A%20Top%20tips%20to%20improve%20your%20home's%20energy%20efficiency,-26.11.21%20By&text=Compared%20to%20a%206%2Dstar,amount%20of%20electricity%20we%20use.">expensive to run</a>. While an efficient reverse cycle air conditioner would save money and heat the space better over the longer term, it is often difficult for renters to negotiate installation with property managers or landlords – especially given the intense competition for rentals at present in many cities. That can mean renters will suffer in silence, unwilling to ask for something that will make their lives better. <h2>What can renters do?</h2> Low income renters face real threats from energy poverty this year. While we need systemic change to improve the outlook for Australia’s renters, there are low-cost DIY ways to improve how <a href="https://www.yourhome.gov.au/">your house retains heat</a> this winter. The first step: check your current heating appliances are working efficiently. Many people don’t clean the filters on their reverse cycle air conditioners. This makes them less efficient, and can drive up energy bills. Poorly sealed windows and doors make it hard to stay warm. Using <a href="https://home.howstuffworks.com/home-improvement/heating-and-cooling/insulated-curtains.htm">thermal curtains</a>, and keeping them closed makes a big difference. Putting a piece of plywood or even a scarf between the curtain rail and the wall to make a <a href="https://environmentvictoria.org.au/2011/07/05/take-the-chill-out-of-winter-with-diy-pelmets/">DIY pelmet</a> also helps keep the heat in. If you have single glazed windows, consider <a href="https://renew.org.au/renew-magazine/buyers-guides/window-buyers-guide/">window films</a> as a way to improve performance for a fraction of the cost of double glazed windows. <a href="https://blog.csiro.au/draught-proof-house/">Sealing the cracks</a> around windows, under doors and around the wider home is also important. Silicon or expanding foam can be used for gaps and cracks. Draughts under doors can be stopped with door seals or door snakes. Close the doors to your bathroom, laundry and other rooms not in use to keep the heat where you need it most. Hanging a blanket over a doorway can also be a cheap way to seal off a room and concentrate heat. It’s also worth checking what rebates and concessions your state government or council is offering. These might include energy efficiency improvements or extra help with heating costs. If you’re renting, your home must meet <a href="https://www.energy.vic.gov.au/energy-efficiency/minimum-rental-standards">minimum standards</a>, so make sure you check what you are entitled to as these vary by state. Everyone deserves a warm home. Our health and well-being depend on it. Building new, energy efficient homes is only part of the answer. We also have to make our 10.8 million <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/total-value-dwellings/latest-release#:%7E:text=Total%20value%20of%20dwelling%20stock,-Download&text=Range%3A%206400000%20to%2010400000.&text=End%20of%20interactive%20chart.&text=The%20preliminary%20estimate%20of%20the,in%20the%20December%20quarter%202021.">existing dwellings</a> warmer. Image credits: Getty Images This article originally appeared on <a href="https://theconversation.com/if-youre-renting-chances-are-your-home-is-cold-with-power-prices-soaring-heres-what-you-can-do-to-keep-warm-184472" target="_blank" rel="noopener">The Conversation</a>.

Home & Garden

Over 60

News

Shop

Catalogues

Travel

Health

Lifestyle

Finance

Entertainment

Property

Information

Keep up to date

Search

To move or not to move: is it cheaper to find a new place or stay when your rent increases by 10%?

Becoming a landlord while still renting? ‘Rentvesting’ promises a foot on the property ladder, but watch your step

The debate: Should kids over 18 pay rent if they’re still living at home?

Princess Diana's childhood home up for rent

The rental housing crisis is hurting our most vulnerable and demands a range of solutions (but capping rents isn’t one of them)

Room to Move: Desperate renters forced into backyard boxes

House with "free" rent listed with major catch

Artist puts the lid on rubbish rental prices

Landlord rents out balcony for $300 a week

How much it costs to rent Hugh Jackman’s bucket list home

Calls to protect rights of tenants with animals

Aussie man faces sky-high rent for “rotten” home

Do tenancy reforms to protect renters cause landlords to exit the market?

Leaked email advises landlords to increase rent amid housing crisis

5 things to do before renting to family or friends

Rent crisis? Average rents are increasing less than you might think

Tiny “furnished” flat asks for eye-watering rent

Outrage after 1830s "slave cabin" listed for rent

Leonardo DiCaprio has listed his gorgeous $14 million mansion for rent

If you’re renting, chances are your home is cold. With power prices soaring, here’s what you can do to keep warm