Private Renting

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GUEST OBSERVER
A growing proportion of Australian households depend on the private rental sector for accommodation. This growth has occurred despite substantial insecurity of tenure under the law, unlike other countries with high private rental rates, such as Germany. 
Our newly published research on the impacts of long-term or even lifelong insecurity on Australian private renters found their responses range from lack of concern to constant fear and anxiety.
So, how many people are affected? Back in the 1990s about one-fifth of us rented our homes from private landlords. Now this has swelled to more than one-quarter. 
Historically, renting was usually a transitional step in the life cycle. Most people rented for a while and eventually bought a home. 
While this housing pathway is still dominant, a growing number of Australians cannot make this transition. At least one in three private renters are long-term private renters (ten years or more). This equates to at least one in 12 households.
Australian households rent accommodation under a regulatory framework that provides little protection against landlord-instigated “forced moves” or untenable rent increases. The initial written agreement/lease rarely extends beyond a year. Once it ends, the tenancy typically shifts to a “periodic” basis, and notice to vacate can be given without reasons.
The period of notice ranges from 42 days to 26 weeks – depending on the state or territory. Thus, beyond the initial lease, all private tenants are subject under the law to ongoing insecurity.
Drawing on 60 in-depth interviews, we explored the impacts of this de jure housing insecurity on long-term private renters in different housing markets (low, medium and high rent, with 20 interviews in each) in Sydney and Melbourne. We identified three typical responses to ongoing insecurity:
<ul>
<li>
incessant anxiety and fear;
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<li>
lack of concern; and
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<li>
concern offset to an extent by economic/social capital, with renting sometimes seen as the only means of living in a desired area. 
</li>
</ul>
We discuss these responses in turn.
<h2>Incessant anxiety and fear</h2>
For one group of interviewees, the insecurity was a persistent source of stress. They were constantly anxious about the possibility of being asked to leave their homes or incurring an untenable rent increase. 
Low-income interviewees in the low-rent outer suburban areas had limited economic and sometimes social capital. A notice to vacate invariably caused great anxiety as they had minimal resources to find alternative accommodation. 
Interviewees solely reliant on government benefits for their income were especially vulnerable. Frieda, 40, a single parent with five children, described her perceptions and experiences:
"At any minute I can get the letter to say, ‘Sorry, but you’ve got to move’ … The last house before this one … was supposed to be a long-term but he decided to sell that house. And then we got [another] one … and then [the owners] wanted the house back … We got notice [to vacate] but [were] still trying to, you know, find somewhere … For a while there, I was thinking we’ll be out on the street."
Nigel, 35, lived alone in a low-rent area in outer western Sydney. He had been receiving workers’ compensation, but when interviewed relied entirely on Newstart for his income. He was confident that his landlord would not ask him to leave, but needed all his income to pay his rent. This was a source of intense insecurity and he was not coping.
"I’m getting $661 a fortnight, my rent is $660 [a fortnight], so if it wasn’t for friends, you know … Stress is gone beyond a joke … You don’t know what you’re going to do the next day."
Christine, 57, also depended on Newstart for her income. She had lost her job a couple of years earlier after falling ill. Fear and anxiety were woven into her comments:
"A renter – you’ve always got that fear that you’re not going to have a roof over your head … Yes, I’ve been here 16 years, but you never know. The house can be sold and new owners can say, ‘No, we want you to go.’ You don’t have money for a bond for another premises or, you know, Housing Department can’t help you because you’re not what they consider to be [in] an urgent, desperate situation."
<h2>Not a concern</h2>
At the opposite end of the spectrum were interviewees who had deliberately chosen long-term private renting and were unconcerned about the possibility of a landlord-instigated forced move. “Renters by choice” tended to be single people or couples without children who lived in high-rent areas. They usually had ample economic and social capital and saw the flexibility associated with renting as an advantage. 
Sarah was living in a high-rent area in inner Melbourne:
"And I do have enough money to buy quite a nice apartment, but I’d rather use the interest and the share money [dividends from shares] and stuff to travel."
Angela and her partner lived in the same area. They had no children and preferred not having a lease:
"So the insecurity doesn’t bother me … It’s more to do with my freedom within that. It means that I can just leave whenever I want if I want to."
Astrid felt totally at ease with her long-term renter status in high-rent inner Sydney. In her late 30s and single, she had a reasonable income and strong social capital. She had rented for all her adult life:
"It doesn’t bother me [being asked to vacate] … If they come and say they’re going to sell, well, there’s a reason. It was meant to be, so yeah … There’s always somewhere to stay. So it suits my lifestyle. I wouldn’t want to buy anything even if I had the money."
<h2>Moderate concern</h2>
Interviewees in high and medium-rent areas were typically in a different position to tenants in low-rent areas. Their economic capital enabled them to rent (but not buy) in an area with good public schools and amenities, and to move if need be.
However, they were reluctant long-term renters and troubled by their housing insecurity. This was especially so if they had school-going children. 
Moira (high-rent area, Sydney), married with two children and in her mid-40s, was pleased with her rental situation. She paid an unusually low rent for her three-bedroom apartment. Alongside the area’s high-quality amenities, the quality of the public schools was a major drawcard.
However, the ever-present possibility of having to vacate was a concern:
"The fact that you don’t know how long you’re going to be there for and, you know, that was a massive thing when we were choosing a school … If we have to move, are we going to be able to be within distance … to keep him there? … And it [the lack of security] is a cloud that’s there always."
The main reason Glenn and his partner rented a small semi-detached house in a high-rent area in Sydney was to ensure their son had a good schooling:
"We need to stay in the area for our son and we balanced that against sending him to a private school, so in that way it’s cheaper to live here even though the rent’s high."
<h2>A crisis of affordability and insecurity</h2>
The interviews indicated that the de jure insecurity associated with private renting in Australia doesn’t necessarily translate into de facto insecurity. 
However, for at least one in four of our interviewees, the chronic de jure insecurity associated with private renting imbued everyday life with ongoing anxiety and stress. 
The intensifying crisis of rental affordability in Australia’s major cities means these negative outcomes of long-term private renting are likely to affect growing numbers in the years ahead.
<a href="https://theconversation.com/profiles/alan-morris-13337" target="_blank">Alan Morris</a> is research professor, University of Technology Sydney.
<a href="https://theconversation.com/profiles/hal-pawson-147969" target="_blank">Hal Pawson</a> is associate director - City Futures - Urban Policy and Strategy, City Futures Research Centre, Housing Policy and Practice, UNSW.
<a href="https://theconversation.com/profiles/kath-hulse-228874" rel="author">Kath Hulse</a> is research professor, Swinburne University of Technology.
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jchancellor-FAypfDUnLy

The insecurity of private renters – how do they manage it?

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GUEST OBSERVER
<a href="https://theconversation.com/housing-still-out-of-reach-for-many-even-as-rents-fall-in-post-boom-western-australia-76461" target="_blank">High rents</a> and <a href="https://theconversation.com/the-insecurity-of-private-renters-how-do-they-manage-it-77324" target="_blank">short-term rentals</a> are driving people to organise themselves to share rooms with strangers in order to live in the city. Room sharing outside a family environment is also occurring in some professions. This includes airline stewards and submariners, nurses on shifts, or hospitality workers in remote or seasonal locations, to name a few.
There are precedents where this arrangement is not unusual. Youth and backpacker hostels offer room sharing as a budget option.
In the cases of the workers above, however, the roomies are part of an organisation and are colleagues. This ensures some vetting has taken place and that their conduct is expected to be in keeping with their paid position and contract.
Youth hostels have management to handle complaints and to keep an eye on things. But what about when you are sharing a room and found your roomie through a website? Who is in charge? And how do you really know with whom you are sharing?
City living costs are driving people to organise themselves to share a room with strangers so they can live in their required location. It’s harder than ever to afford your own bedroom to sleep in.
Various websites list hundreds of offers to share rooms in central Sydney. Beds are available from about $150 to over $230 a week. Room sharing also happens in suburbs like Double Bay, Mossman or Marrickville.
(Picture above) “Looking for one girl to share a master room with another 3 girls.” Screenshot from Gumtree ad, August 19 2017, 11:58 , Author provided Christian Tietz, UNSW
A recent article, “How short-term rentals are making Sydney’s housing crisis worse”, calculates that about 6,000 properties are removed from the rental market and offered to higher-paying tourists through “sharing economy” sites like Airbnb. We have an indication what the potential tenants who can’t afford to rent a flat anymore are doing – they are room sharing. I estimate thousands of people are room sharing right now in the inner city.
Exceeding capacity causes many problems
Overcrowded apartments, beyond interfering with the amenity of strata owners, have a number of other implications. One is that these packed living arrangements raise basic health concerns. Historically, <a href="https://www.history.com/topics/tenements">19th-century New York tenements</a> come to mind. How are facilities like bathrooms and toilets – the <a href="https://researchdirect.uws.edu.au/islandora/object/uws:20120">health hardware</a> – going to hold up when used by multiples of the occupants they were originally designed for?
In Australia today, we know relatively little about the extent of chronically overcrowded housing. But research has looked at its impact on those Indigenous householders for whom it’s a fact of daily life. In some cases, up to five people share one bedroom and up to 30 people use the services of one house.
It’s not because they like it, but because there are not enough houses that <a href="https://www.researchgate.net/publication/249879335_This_Is_Not_a_Pipe_The_Treacheries_of_Indigenous_Housing">perform well</a>. Product selection is not fit for purpose and goes hand in hand with a lack of maintenance. <a href="https://www.bshf.org/world-habitat-awards/winners-and-finalists/housing-for-health-programme/">Award-winning research</a> shows this makes it virtually impossible for these householders to carry out basic <a href="https://www.healthabitat.com/the-healthy-living-practices">healthy living practices</a>.
Appliances, fittings and fixtures are engineered to cater to household, commercial, industrial or military performance demands. Fit-out quality selection has direct implications on product life and therefore performance. If these products fail because they are not suitable, this has impacts on <a href="https://www.propertyobserver.com.au/www.health.nsw.gov.au/environment/Publications/housing-health.pdf" style="font-size: 12.16px;">health and wellbeing</a>.
The research shows that this is not the fault of the residents, Indigenous or otherwise. Now these <a href="https://www.propertyobserver.com.au/healthabitat.com/what-we-do/what-the-housing-data-reveals/why-the-houses-need-fixing">well-documented</a> issues are being reproduced in dense urban settings.
Who is going to repair the cheap and non-compliant fixtures when they fail? The poor occupants? What kind of replacements can be expected? High-quality commercial fittings to suit the 500% higher use, or cheap replacements that will predictably fail again in due time?
<h2>Can a shared room be home?</h2>
Lack of personal space and privacy are other problems. The images on the websites clearly demonstrate practical day-to-day concerns. Where do you store your things? There is no existing furniture product category that meets the requirements of sharing with strangers.
A seasonal worker in the Snowy Mountains told me the workers left damp clothing lying on the floor between their bunks. But even if you can hang your things up somewhere, how do you ensure they are still there when you come home? Internal doors generally don’t have key locks and nor do cupboards. Tenants can’t even hang a picture, so how can they secure their space?
Ikea offers furnishings for small flats and some of their products are thoughtfully designed to make small spaces more effective. But they don’t have products for these room-share settings. Renting means you are not allowed to drill holes to install shelves or even hooks.
It appears that the precarious life of the roomie, who lacks a sense of security, stability, privacy, safety and the ability to control their living space, meets the Australian Bureau of Statistics (ABS) <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/4922.0Main%20Features22012?opendocument&amp;tabn">definition of homelessness</a>. A bed alone does not make a home. <img src="https://cdn.theconversation.com/files/188693/width754/file-20171003-31655-1gpt5yk.JPG" alt="">
Private life in public space? Image by C. Tietz, Author provided
<hr>
<a href="https://theconversation.com/profiles/christian-tietz-120703" style="font-size: 12.16px;">Christian Tietz</a>, Senior Lecturer in Industrial Design, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>
This article was originally published on <a href="https://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/room-sharing-is-the-new-flat-sharing-84359" target="_blank">original article</a>.
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pc-iUQkvULHPU

Room sharing is the new flat sharing

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The Victorian government’s plan for major rental reforms could turn away landlords from renting, and inadvertently lead to a surge in short stays such as Airbnb in Melbourne, says a leading strata management body. 
A response from the state government on short stays following lengthy public consultation is due on December 8, and the proposed new rental laws once again highlight the need to get short stay regulation right, according to Strata Community Australia (Vic) — the peak industry body for strata management in Victoria. 
SCA general manager Rob Beck says rightly or wrongly, stronger tenant rights could see landlords review how they use their investment properties. 
“Key proposals like the removal of no pet clauses in rental agreements, a cap on maximum rental bonds and new protections to make it easier for renters to make minor modifications to the property are ones which will likely make owners think long and hard about whether they want to keep renting or not,” said Rob Beck. 
Landlord insurance will go up after the Andrews' government <a href="https://www.urban.com.au/news/76815-pet-policy-for-tenants-will-trigger-higher-landlord-insirance" target="_blank">pet policy for tenants</a> is introduced in Victoria next year.
Emphasizing the need to regulate short stays, Beck said it wouldn’t be a surprise to see a shift from investor owners towards short stays if the proposals announced for new rental laws are brought into effect, and that this raised “the importance of having short stay regulation in place to new levels”.
Beck says short stays present a unique challenge for strata communities to manage compared to leasing arrangements, and SCA (Vic) wanted regulations to allow strata schemes have better control over this issue. 
More than 1.6 million Victorians live in strata properties, so potentially a huge number in Melbourne could be impacted by a spike in short stays, according to Beck.
“What we want to see as part of the regulations delivered by State Government are measures like the ability for strata schemes to create rules to regulate short stays, and the ability to recover costs such as any damage or any increased proportion of strata fees. 
“These would work to make strata schemes better able to manage these stays.” 
“Provided the right regulatory framework exists, short stays have a place in Victorian strata communities, and it will be perfect timing ahead of the summer period, for the State Government to deliver laws for the busy years ahead.” 
 
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jonathanchancellor-7SQnKwU6yx

Victoria's new rental reforms could trigger surge in short stays: Strata body

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EXPERT OBSERVERS
In low-rent outer suburbs, almost one in six households could not afford to keep their house cool and went without meals.<a class="source" href="https://www.shutterstock.com/image-photo/ashkelon-july-30a-poor-man-looks-116883439?src=pz36NnyfTHFCIB6ziBOFUg-1-1&amp;studio=1"> </a>
Private renting continues to expand at the expense of home ownership, newly released <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/4130.0%7E2017-18%7EMedia%20Release%7EMore%20households%20renting%20as%20home%20ownership%20falls%20(Media%20Release)%7E10" target="_blank">ABS statistics</a> show. More than one in four Australians (27%) are now tenants of a private landlord (2017-18). Only one in five lived in private rental housing in 1997-98.
<a href="https://www.tandfonline.com/doi/full/10.1080/14036096.2018.1467964" target="_blank">Our research</a> looked at private renters in middle and inner suburbs and low-rent outer suburbs (200 private renters in each area, 600 in total) in Sydney and Melbourne. Geographical differences in income sources and deprivation rates might be expected. However, the variations in <a href="https://www.sprc.unsw.edu.au/media/SPRCFile/Report12_07_Deprivation_and_exclusion_in_Australia.pdf" target="_blank">financial stress</a> revealed by our study were startling. In low-rent outer suburbs, much higher proportions, for example, went without meals or had to pawn or sell something to get by.
<h2>Household incomes</h2>
Not surprisingly, tenants in the inner/middle suburb areas and the (low-rent) outer areas had a very different profile of income sources, as Table 1 shows.
<a href="https://images.theconversation.com/files/285969/original/file-20190729-43109-1yvajhm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/285969/original/file-20190729-43109-1yvajhm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Author provided
In areas with medium and high rents, wages or salaries were the main source of income for more than four out of five respondents (83%). In the outer suburban, low-rent areas, this was true for barely half (56%). A third relied mainly on state pensions or benefits.
In more than a quarter of tenant households (28%) in low-rent areas at least one member was an unemployed job-seeker. Only 8% of households in the medium/high-rent areas included an unemployed member.
Finally, once again indicating the typically more deprived situation of the outer suburb group, a much greater proportion of these tenants, 62%, received Commonwealth Rent Assistance compared to 21% in the other areas.
<h2>Signs of financial stress</h2>
Respondents were asked: “Over the past year, have any of the following happened to you/your household because of a shortage of money?”
We <a href="https://www.tandfonline.com/doi/full/10.1080/14036096.2018.1467964" target="_blank">found levels of financial stress</a> varied greatly between areas. Among low-rent (outer suburban) tenants almost two-thirds (63%) experienced at least one of the eight possible financial stress indicators listed in Table 2. That’s twice the proportion for the inner/middle-area cohort (32%).
Benchmarking both of these figures against the nationwide rate of 20% (based on the <a href="https://www.abs.gov.au/AUSSTATS/subscriber.nsf/log?openagent&amp;HECS%20additional%20tables.xls&amp;4670.0&amp;Data%20Cubes&amp;4C08051315A91B1ACA257C6F000EC23C&amp;0&amp;2012&amp;24.02.2014&amp;Latest" target="_blank">all-tenure national comparator on the incidence of financial hardship</a>) illustrates the pervasiveness of economic stress among private renters in all areas of our major capital cities. But in outer suburban low-rent areas of Sydney and Melbourne the risk of financial hardship is more than three times the national norm among tenants. <a href="https://www.tandfonline.com/doi/full/10.1080/08111146.2016.1272449" target="_blank">Our earlier research</a> also noted this.
Comparing the two tenant groups revealed statistically significant differences on every financial hardship indicator – see Table 2.
<a href="https://images.theconversation.com/files/285972/original/file-20190729-43114-iry4ai.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/285972/original/file-20190729-43114-iry4ai.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Author provided
Strikingly, almost one in six households living in low-rent areas went without meals. A similar proportion had to pawn or sell something to get by.
One in three tenants in these areas turned to family and friends for financial help. Almost one in four (23%) sought help from a welfare or community organisation.
Exposure to multiple forms of financial stress indicators was also much greater in low-rent areas. One in five (19%) tenants here reported enduring four or more financial stress indicators versus 6% in medium/high-rent areas. For households in this position, damaging impacts on their quality of life and probably <a href="https://www.tandfonline.com/doi/full/10.1080/02673037.2017.1344202" target="_blank">physical and mental health</a> are likely.
<a href="https://images.theconversation.com/files/285974/original/file-20190729-43114-1cszm0t.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/285974/original/file-20190729-43114-1cszm0t.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a> Author provided
<h2>A common theme to financial stress</h2>
We found that being reliant on government benefits was associated with multiple indicators of financial stress, irrespective of area. More than one in three (37%) such households experienced four or more of the financial stress indicators. Alarmingly, poverty resulted in 26% of this grouping going without meals in the last year.
Employment status was a significant factor irrespective of area. In households where a household member was either looking for work, out of the workforce or retired, 27% of these households had four or more financial stress indicators. In households where at least one person was employed full-time, only 5% had four or more stress indicators.
The ongoing trend of increasing housing cost pressures on lower-income Australians over the past decade provides the context for the high incidence of financial stress, particularly among tenants in low-rent areas of Sydney and Melbourne. <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/4130.0%7E2017-18%7EMedia%20Release%7EMore%20households%20renting%20as%20home%20ownership%20falls%20(Media%20Release)%7E10" target="_blank">Latest ABS data</a> reveal that, for the least affluent fifth of households, typical spending on housing increased from 23% of income to 29% over that period. In contrast, typical spending on housing by the top fifth was unchanged at 10%.
<h2>The case for increasing benefits</h2>
Our study brings home that <a href="https://www.publish.csiro.au/book/7269/" target="_blank">everyday life is an enormous battle</a> on various fronts for many benefit-reliant and other low-income tenants in Sydney and Melbourne. Even if they can find a tenancy in a low-rent area to keep housing costs down, their likelihood of after-housing poverty, including <a href="https://www.thefifthestate.com.au/columns/spinifex/energy-poverty-urgently-end-2/" target="_blank">energy poverty</a>, is high.
At the most extreme end of the scale are the one in five tenants in the outer low-rent areas (one in ten across all three areas) who experienced severe financial stress (four or more indicators of financial stress). After paying for their housing, many of them lack money for essentials.
Being located on the urban fringe, and therefore often remote from services and/or employment, compounds such hardship. Not surprisingly, the incidence of financial stress is highest among government benefit recipients. This finding highlights the urgent need to increase Commonwealth Rent Assistance to offset some of their housing costs, and also to increase key income support payments, such as <a href="https://www.acoss.org.au/wp-content/uploads/2018/03/Raise-the-Rate-Explainer-1.pdf" target="_blank">Newstart and the Disability Support Pension</a>.<img src="https://counter.theconversation.com/content/120427/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" 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; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/alan-morris-13337" target="_blank">Alan Morris</a>, Research Professor, <a href="http://theconversation.com/institutions/university-of-technology-sydney-936" target="_blank">University of Technology Sydney</a>; <a href="https://theconversation.com/profiles/hal-pawson-147969" target="_blank">Hal Pawson</a>, Associate Director - City Futures - Urban Policy and Strategy, City Futures Research Centre, Housing Policy and Practice, <a href="http://theconversation.com/institutions/unsw-1414" target="_blank">UNSW</a>; <a href="https://theconversation.com/profiles/kath-hulse-228874" target="_blank">Kath Hulse</a>, Research Professor, Centre for Urban Transitions, <a href="http://theconversation.com/institutions/swinburne-university-of-technology-767" target="_blank">Swinburne University of Technology</a>, and <a href="https://theconversation.com/profiles/violet-xia-781289" target="_blank">Violet Xia</a>, Research Associate, <a href="http://theconversation.com/institutions/university-of-technology-sydney-936" target="_blank">University of Technology Sydney</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/private-renters-are-doing-it-tough-in-outer-suburbs-of-sydney-and-melbourne-120427" target="_blank">original article</a>.
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