New data has revealed only three suburbs in regional Victoria are still considered affordable for renters, as tenants continue to feel the impact of the state’s rental crisis.
The Rental Affordability Index, released today by the National Shelter-SGS Economics and Planning, showed only Kerang in the state’s north, Nhil in the northwest and Numurkah north of Shepparton were still considered affordable rental areas.
To qualify as affordable, rental properties must hold a rental affordability index (RAI) score of between 151 and 200 and only cost tenants up to 15 per cent of their income.
The Surf Coast is the most expensive area for renters, with Torquay, Barwon Heads and Ocean Grove, requiring the average rental household to spend more than 38 per cent of income on rent.
Since 2019, affordability in Apollo Bay has declined from acceptable to severely unaffordable.
Rental affordability in Bendigo and Shepparton has also declined from moderately unaffordable to unaffordable since 2022.
“These stark figures show Victoria’s housing and rental affordability crisis continuing to plumb new depths and everybody – families, workers and the broader economy – is losing out,” said CEO of National Shelter Emma Greenhalgh in a statement provided to Build-it.
“People who are priced out of metropolitan Melbourne would usually look to regional areas. But now, only three very small areas of Victoria are considered affordable.
According to the Chief of Services at Brotherhood of St Laurence, Julie Ware, the rental crisis has left virtually nowhere in regional Victoria affordable for lower-income earners and those receiving support payments.
“It is wrong that those who are already facing significant poverty and barriers to work are left to pay the price for this unacceptable market failure,” said Ms Ware.
For single people on Jobseeker, single or coupled pensioners, and single part-time worker parents on benefits, rents were classed as either unaffordable, severely unaffordable or extremely unaffordable.
Tenants with an average annual household income in regional Victoria of $81,566 reportedly spend 27 per cent of their income purely on rent.
Unaffordability is hurting the local economy
According to the Principal at SGS Economics & Planning, Ellen Witte, the unaffordability of rent in is beginning to severely impact the state’s economy.
“Households have to live further away from where the jobs are to access affordable rents, and businesses are struggling to find workers.
“Nursing homes are struggling to find nurses, schools to find teachers and the building sector to find builders to build houses.
“This disproportionately punishes people with the least while also pricing full-time and essential workers out of their own city.”
If the state is to have any hope of combatting the rental crisis, Ms Witte said they need to approach the problem from multiple angles.
“This means expanding rapidly social and affordable housing, rethinking how we use tax subsidies and strengthening renters’ rights,” she said.
“Regional Victoria’s rental affordability will continue to deteriorate from crisis to catastrophe without urgent intervention from state and federal governments.”
