Housing shortage hurts regional Australia

As Dr. Raphaella Crosby prepared to return to her hometown, a severe storm slammed into her, ripping roofs off, toppling trees and splitting utility poles.

Bad weather hit Armidale, a scenic country town in the northern tablelands of New South Wales, in October, damaging the house she was due to move into from the Gold Coast.

Confronting Mother Nature was one thing, but finding a house to rent in an area would prove Crosby’s ultimate battle.

“I said to myself: ‘Oh, I’ll be fine, I’ll find something, it won’t be a problem. It’s Armidale’.

“What I didn’t realize was that there was a massive boom. There were so many people like me who didn’t need to live in the city anymore.”

The policy researcher applied for about 50 properties, many over $500 a week, at friends or hotels while she searched for two months.

Just before Christmas, she secured a three-bedroom house for $420 a week, more than she had paid for rental apartments in Queensland and Bondi Junction.

“Affordability was an issue. The idea that I would pay more rent in Armidale than in the Gold Coast still scratches my soul.

“It just seems wrong on a fundamental level.”

Expensive and competitive rental markets are affecting locals and newcomers in areas across Australia, in part due to the influx of people fleeing cities and working remotely from the country or the coast.

Experts say it’s a crisis that will only get worse as demand for regional housing outstrips supply, pushing prices even higher and creating complex and far-reaching consequences for local economies and communities. low-income workers.

Rental housing and homelessness research from the University of NSW and the Australian Council of Social Services shows a rapid rise in rents from mid-2020, the fastest in over a decade.

Those in the regions jumped 12.4% in the year to August 2021. By comparison, wage growth was 1.7%.

Head of research at Propertyology Simon Pressley predicts private market rents will rise between $100 and $200 a week over the next year in 54 regional centers, including Bundaberg in Queensland, Geraldton in WA, Victoria’s Lorne, Mt Barker in SA, Burnie in Tasmania and Dubbo in NSW.

He says rental housing shortages were evident five years ago, when vacancy rates in some areas were below 2%.

“Two years ago COVID turned the world upside down but the problem was already there.

“In some of these places, this was already showing in rent spikes, and other places were just reaching the critical shortage of supply.”

In addition to pandemic pressures, demand for rentals is driven by everyday factors such as people moving for new jobs, divorced couples looking for separate homes, and young adults moving out of family homes.

In the private market, Pressley says, there’s a lot of bureaucratic “courage” and regulation that discourages investors from becoming homeowners in addition to increased property taxes, insurance and maintenance costs.

Many investors are seeing the benefits of renting out properties as vacation homes through services like AirBnb, an issue that has sparked a parliamentary inquiry in WA and caps on short-term accommodation in several areas.

But affordable housing advocates say a deeper problem is the severe shortage of social housing and subsidized rentals reserved for low-income people.

Kate Colvin, of campaign group Everybody’s Home, says high rents and property shortages can affect an entire regional town.

“Every community needs essential workers who are not very well paid, like childcare workers, the elderly, supermarkets, hoteliers.

“This is a bunch of workers who get paid below $25 an hour. It’s next to impossible for people in that pay bracket, especially if they’re part-timers partial, to find a place in communities that were previously considered affordable.

“So for some communities, that means it can exacerbate labor shortages.”

Everybody’s Home is campaigning on several fronts: to make life easier and fairer for first-time homebuyers, for greater protection for tenants, and a strategy to end homelessness.

The group wants the federal government to develop a national housing plan that includes the development of more social housing and a new tax incentive to encourage private sector investment in properties for low- and middle-income people.

Mission Australia community services director Ben Carblis said he used to experience spikes in rental stress during the summer when landlords moved their short-term tenants to accommodate tourists.

“What we’ve been through here, with the migration of city dwellers to the regions, it’s no longer ups and downs, it’s just a peak,” he says.

Low-income people are moving away from major centres, which generally have better access to medical and social services, towards remote and isolated communities.

This has serious consequences for already vulnerable people, Carblis says.

“We are really in crisis.

“When there is unstable housing, people become more stressed and there are greater concerns for mental health and anxiety.

“These people may turn to drugs or alcohol to cope and addictions start to form, which creates unhealthy relationships, and we have increased family and domestic violence.

“So there can be a downward spiral when the stress and anxiety of not having a stable home is there.”

In its pre-budget submission to the federal government, Mission Australia provided estimates that 614,000 social housing and 277,000 affordable housing units worth $290 billion will be needed over the next 20 years.

“The solution is simple but it is expensive,” says Carblis.

Colvin says the problem affects anyone looking for housing. Competition means homes that were once considered low-rent are now being rented out at mid-to-high prices.

“The real solution is to put more properties on the market, because otherwise it’s just a game of musical chairs. Unless you add more chairs, someone is always going to miss something.

“It’s enormous pressure everywhere.”

Crosby settled into her new home in Armidale but nearly gave up and turned her back on regional life.

“A lot of people who grew up in Armidale have very fond memories of growing up here. We want to come home,” she says.

“One of my values ​​is that if I didn’t need to be in a city, I shouldn’t be. Regional communities need people and they need business.

“It’s a value I’ve had all my life.”

About Gene Schafer

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