Melbourne has just been announced as the most affordable capital city for renters, but new research shows that lower-income earners are still struggling to keep a roof over their head.
The National Housing Finance and Investment Corporation (NHFIC) on Saturday released a report diving into housing affordability across Australia.
The report found that there had been a “modest improvement” in rental affordability for Melburnians between mid 2020 and September 2021 – this is a direct result of the lack of migration that’s been caused by continuous border closures and COVID-19 related lockdowns throughout the entire country.
However the city’s bottom 40 per cent of income earners can still only afford up to 30 per cent of properties that are currently available for rent.
The Head of Department for Propert Management at Ray White Southbank, Persa Kapsali, said that when the pandemic hit vacancy rates “blew up”, which ultimately forced rental prices to go down.
After keys were turned in during the pandemic due to not being able to afford a rental, “the rent on Southbank reduced about 25 per cent – a lot of owners didn’t want to reduce it, but they knew they had to get tennants in.”
Ms Kapsali noted that at the moment prices were still very reasonable for renters who are looking to experience the city life, but she warned that they will rise again as borders opened back up and students and migrants returned to Melbourne.
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The NHFIC report also showed that rental affordability in regional Victoria had plummeted, with the typical renter only able to afford 30 per cent of properties on the market.
This is a significant drop of 20 per cent since June 2020.
There is also an ongoing and extreme shortage of rental properties in regional Victoria.
The NHFIC research will form part of the second State of the Nation’s Housing report, which is due to be released in early 2022.