The chances of finding an affordable home to rent are becoming slimmer for those in regional Australia, according to a new report that spells out the dire state of our housing market.
The National Shelter Economics and Planning Rental Affordability Index has been published since 2015. It is a clear and concise indicator of rental affordability, relative to household incomes.
The index uses the 30 per cent of income rule. That means that low income households paying close to 30 per cent or more of their income on rent are generally seen to be in housing stress.
In its just released 2023 report, suburbs and towns were ranked across seven categories from "very affordable" to "extremely unaffordable".
Ellen Witte, Principal at SGS Economics and Planning, said it shows both regional centres and smaller cities are becoming increasingly out of reach for many renters.
"We see in regional centres... that rents are increasingly unaffordable but especially in those larger regional centres such as Newcastle and the Illawarra, people will be paying 30 up to 44 per cent of their income on rent," Ms Witte said.
According to the report, the greatest decline in affordability over the past three years is evident in coastal areas like Port Macquarie and parts of the Kempsey Shire.
These areas have changed from Affordable to Unaffordable as a result of shifting housing preferences during the COVID-19 pandemic.
Renters in capital cities fared worse, with Sydney now equal to Hobart as the least affordable rental housing market in the country.
Western and south-west Sydney were previously among the most affordable regions of the city and considered in the affordable range in 2021.However these have now deteriorated into unaffordable categories.
The Bankstown to Campsie corridor in the city's south-west had also dropped a category from "affordable" to "acceptable".
"Key workers in critical industries are travelling further and further and being priced out of the city," said Ms Witte.
While Melbourne remains the country's most affordable capital for renters, rental affordability has continued to decline from during the pandemic when rents dropped significantly.
Rents have risen 16 per cent over the past year, driven mainly by rapid price rebounds in one and two-bedroom apartments that now exceed pre-pandemic levels.
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