The Reserve Bank board has lifted official interest rates 10 times since they were 0.1 per cent in May 2022, increasing the cash rate to 3.6 per cent at its last meeting earlier this month.
“The decline in the demand for new dwellings is expected to weigh on overall dwelling investment over the next few years. As a result, vacancy rates are likely to remain at low levels,” the report said.
Bennelong MP Jerome Laxale said many of his constituents are struggling with large increases to their rent.CREDIT:ALEX ELLINGHAUSEN
Labor MP Jerome Laxale said 40 per cent of residents in his electorate of Bennelong, which covers parts of northern Sydney including Ryde, are renters. It’s the highest concentration of tenanted properties in the country – and those renters have been struggling with large increases to their rent.
“What we’re seeing with that is just chaos at open houses, lack of availability, and situations where landlords are putting up rents by 10, 15, 20 per cent, in response to what’s been a pretty aggressive fiscal policy by the Reserve Bank,” he said.
Laxale said renters and low- to middle-income earners were disproportionately affected by rate rises.
“I’m getting evidence that landlords are using the rate rises and the increased cost to justify rent increases over and above the average interest rates, and that’s just making a bad situation worse,” he said.
Separate research released this week found Australia’s rental market wasfailing both landlords and tenants.
The report from property services companies LongView and PEXA showed landlords would be better off putting money into superannuation, while tenants face some of the worst conditions in the developed world.
Greens housing and homelessness spokesman Max Chandler-Mather said the government should be ashamed of the state of the rental market.
“This is a national crisis that needs a national response, and it’s no longer good enough for the PM to fob his responsibility for protecting renters off to the states,” he said.
Chandler-Mather said the country needs national tenancy standards and rent freezes to help protect renters who were forced to deal with mould, electrical and plumbing problems, poor insulation and a lack of longer-term security.
“With renters in Australia facing out-of-control rent increases and some of the worst conditions in the developed world, it would be a moral and humanitarian failure for the PM not to push for national tenancy standards and a freeze on rent increases,” he said.
Any changes to tenancy standards or rent freezing would have to occur through an agreement like the national housing accord, as the federal government does not have the power to make those decisions unilaterally. The federal government last brought in a rent freeze in 1945.
