It has never been harder for Melburnians wanting an affordable place to rent, according to new official figures.
As more renters suffer from rental stress even in traditionally low-cost areas, the proportion of affordable properties available to lease plunged to a record low.
The Department of Health and Human Services’ rental affordability data shows just 5.7 per cent of new lettings were affordable over the March quarter — the lowest since the report was first compiled in March 2000.
In comparison, more than 16 per cent of new lettings were affordable — defined as costing no more than 30 per cent of government assistance — at the same point 17 years ago.
Housing experts say the latest figure for metropolitan Melbourne was not surprising, but shocking nonetheless.
National Shelter executive officer Adrian Pisarski said affordable rentals for low-income earners were diminishing because incomes were not keeping pace with rental prices.
Over the past decade, Victoria’s median weekly rent has increased 75.7 per cent while the median household income grew just 38.8 per cent.
Mr Pisarski said the government had recently introduced incentives to encourage investment in the sector, but it was not going to work for another three to five years.
“In the meantime, I would suspect that these numbers [would] keep deteriorating,” he said, adding that more social housing needed to be built.
Mr Pisarski said the latest census showed social housing across Australia had dropped to 4 per cent, the lowest level in about 60 years.
It was not sufficient to meet the needs for social housing for low-income people, who were being pushed further out from the city, he said.
An analysis of the data shows the City of Greater Dandenong experienced the biggest drop in the proportion of affordable lettings, from 58.1 per cent in March 2000 to just 8.5 per cent in March 2016.
From the December quarter, the proportion of affordable properties dropped from 8.6 per cent.
The Frankston, Cardinia, Melton, Yarra Ranges, Brimbank and Casey council areas have also recorded significant falls since March 2000.
Council to Homeless Persons policy and communications manager Kate Colvin said she was not surprised that rental affordability had sunk even lower, but it was “very worrying”.
Decreasing rental affordability was the main factor driving homelessness, she said. The number of people accessing Victorian homelessness services increased by more than 50 per cent over the past five years.
“It’s just indicative of broader government policy failure,” she said. “The way the tax incentives are structured means there are more incentives to invest at the more expensive end of the market.”
Increasing the supply of housing alone did not necessarily improve affordability, Ms Colvin said, because many one-bedroom apartments developed were relatively expensive because they were new.
Only 0.4 per cent of new one-bedroom lettings in metropolitan Melbourne were affordable over the March quarter.
RMIT urban policy professor Jago Dodson said though there had been a reasonable increase of rental supply, it was struggling to keep up with Melbourne’s rapid population growth.
House price inflation in recent years had also put pressure on rents, Professor Dodson said, adding the government needed to be more actively considering innovative mechanisms to procure affordable housing.
“I think we really need to be taking our efforts to another level, particularly as we are looking at a city of possibly 8 million within the next 20 or 30 years,” he said. “We don’t want to leave it too late to start acting on this because it’s very much harder to catch up down the track.
“If we’re going to celebrate the growth, then we also need to be putting at least the same level of effort into addressing the problems, challenges and difficulties that that growth brings.”
Professor Dodson pointed to inclusionary zoning – where a percentage of new developments were allocated to affordable housing – and the new bond aggregator model as mechanisms to increase affordable housing.