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Call for better government assistance in booming rental market

Leading housing experts have called for a major overhaul of the government’s rental assistance scheme, describing payments to low-income households as “inadequate” as rental costs continue to soar.

An analysis of the program by the Australian Housing and Urban Research Institute (AHURI) also found that households that were not in rental stress were still receiving payments, while those living in extremely expensive areas were not. weren’t getting enough.

AHURI chief executive Michael Fotheringham said the key problem with government rental assistance was that payments increased with overall inflation and were not directly linked to rising rental costs or geographic rental trends.

“One of the challenges is that it doesn’t target tenants in any way,” Mr Fotheringham said.

“Someone in central Sydney has the same amount [of support] like someone in Hobart or Perth.”

His analysis of the system found that the new government could save money if it targeted low-income households in areas where rents had risen dramatically.

“Some of the households that benefit from it are not in rental stress. They have relatively low incomes but also pay relatively low rent,” he said.

“I had nowhere to go”

Andrea Ferris says she receives $47 per fortnight in housing assistance.(ABC News: Eddy Gill)

Single mother Andrea Ferris said the rental assistance “barely covers milk and bread” for the week and she was barely able to survive as rents rose.

Rents in Ms Ferris’ hometown of the Gold Coast have risen 21% over the past year.

With vacancy rates across the country at record highs, she was forced to settle for a three-bedroom house well outside her budget.

“I had nowhere to go. It sounded pretty scary, I was considering moving into a friend’s room with the kids,” she said.

“We came three weeks of homelessness.

“I don’t buy fruits and vegetables. The doctor told me my iron was low and asked if I ate red meat and I said, ‘I don’t buy any. I can’t afford it.”

She said government rent assistance has barely changed in a year, despite paying at least $100 more a week in rent.

“It’s $47 a fortnight for $570 a week. That doesn’t even cover our milk and bread for the week. That’s ridiculous.

“You can’t expect the rental market to go up and everyone to cover that.

“[with] the money i get from the government i will be lucky if i have $112 a fortnight [left over] — and that’s to cover electricity, Telstra account [and] all other bills.”

In a statement, Social Services Minister Amanda Rishworth did not say whether the payment would change.

“The Australian Government recognizes that the housing sector faces a number of significant challenges and the government is committed to an ambitious housing agenda, providing national leadership and placing a strong emphasis on stable and affordable housing” , said Ms. Rishworth.

“Commonwealth Rent Assistance is an important part of income support and family payment systems.”

7.30 understands that about $5 billion will be spent on rental assistance next year.

“Just Not Enough”

Angela at her home office in Melbourne.
Economist Angela Jackson wants the government to do more for people suffering from rental stress.(ABC News: Sean Warren)

But economist Angela Jackson said the new government needed to do more.

“On current projections, this is going to help solve the problem,” she said.

“It’s certainly great to have a long-term revenue stream for [build] more social and affordable, but that’s a fraction of what’s needed by current estimates – maybe a tenth of what’s needed.”

Ms Jackson added that increasing the housing stock was not a silver bullet and that housing assistance was a policy lever the government could change to better support short-term tenants.

“It (housing assistance) is just not adequate,” she said.

“It doesn’t cover enough [low-income households’] costs. This means that low-income households, in particular, are experiencing significant rental stress.”

A woman wearing a floral top stands outside.
Maggie Shambrook started a support group for older female tenants.(ABC News: Timoth Pitot)

Maggie Shambrook, 66, started a support group for older women due to challenges in the current rental market.

She was barred from renting a house and is now renting the ground floor from a converted Queenslander.

“To be honest, I couldn’t find anywhere else. There were just no other options,” she said.

But the cost of rent is still more than she can afford with her pension and rental assistance.

“All my savings, a lot of my super [is] gone because there’s no way to pay to live on that kind of money.

Michael Fotheringham, wearing a shirt, stands in front of a bookcase indoors.
AHURI’s Michael Fotheringham says there is “no quick fix” to the rental crisis.(ABC News: Daniel Close)

“I don’t have much left, about 50,000, and if I live any longer I won’t have anything.”

Mr Fotheringham believes the growing challenge of owning a home will lead to more retirees like Ms Shambrook entering the rental market.

He said the new government faced a huge challenge to ensure future retirees could be housed in safe and affordable accommodation.

“There’s no quick fix. It’s taken us decades to get to where we are and it’s going to take two decades to get out of here… The scale of the problem is just huge,” he said. he declares.

“We’re sleepwalking into a bigger problem. It’s a problem that’s going to keep swelling if we don’t knock it down.”

Watch this story at 7:30 a.m. on ABC TV and ABC iview.

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