Accessing and sustaining private rental tenancies: critical life events, housing shocks and insurances

Abstract

The private rental sector has grown significantly and is now home to more than 1.8 million Australian households. This growth has been linked to higher demand from households who are taking longer to save for a house deposit, as well as more strictly rationed public housing. Despite this growth the tenure remains insecure: weak regulation and investors’ pursuit of capital gains has led to more rapid turnover of properties, increasing problems of forced mobility for tenants. The project sought to understand the vulnerabilities of tenants in this context, discerning the effects of critical life events and housing shocks, and availability of private market insurance. It involved interviewing 76 low to moderate-income tenants living in Melbourne, Sydney and Perth about their housing experiences, as well as practitioners to identify emerging types of support for tenants. Two key groups of low to moderate-income tenants emerged: those who have experienced multiple types of adverse life events for whom there can be extreme difficulties in attaining leases and maintaining cash flow; and a new or previously unidentified group who require assistance to manage a key event or transition (e.g. recently arrived migrants). Tenants remarked on affordability as an issue which affects access to housing, dwelling quality and ability to keep up rental payments, and how non-housing related problems were exacerbated by being located in expensive sub-markets. Informal segments of the market enabled households to avoid use of real estate agents, but this opened some up to predatory landlords. Few households had market based insurances like income protection insurance, though such products were helpful for those that did. More common was use of credit to fund housing related needs in a crisis, or to draw on informal and familial networks for support. The latter was apparent for cultures where this was normative such as newly arrived immigrant groups. A deficit of housing literacy also undermined tenants’ capacity to competently navigate the private rental sector. Private renter households in need commonly access Commonwealth funded Rental Assistance (RA). However, this is inadequate when critical life events occur or insurances are exhausted. Governments might, through appropriate local services like medical, legal or migrant support centres, improve knowledge about the rental market, provide bond assistance or payments to meet temporary cash flow difficulties, and help broker households into private rental housing. They might also better regulate the sector to address poor housing standards and predatory landlords