This article is from the Australian Property Journal archive
WELL over half of tenants are facing immediate or anticipating imminent issues with paying rent, as more than a third are concerned they will not be able to pay full rent over the coming months.
According to a new AHURI study, ‘Post pandemic landlord–renter relationships in Australia’ conducted by researchers at RMIT University and University of Adelaide, 60% of tenants are facing immediate or imminent issues paying rent, as the impacts of COVID-19 continue to be felt by renting demographics.
“The pandemic has amplified many weaknesses – such as affordability, rental security, overcrowding and homelessness – in the Australian housing system; and in particular, exacerbated many existing challenges in the rental sector,” said Dr David Oswald, lead author of the report.
Despite 35% of tenants being concerned they will be unable to pay their rent in full, many reported to being apprehensive about asking for rental assistance from their landlords due to concern over eventual repercussions. Particularly that they will receive poor rental references and will not receive repairs to property defects that they are entitled to.
The research discovered that there are currently two distinct groups of landlords, those willing to consider aiding their tenants with financial assistance and those who are not.
Only 50% of tenants who have asked for rent reductions reported that that their landlord or property agent had fully granted it.
“With moratoriums on evictions, rent increases and mortgage deferrals all coming to an end, the issues uncovered by this research risk rapidly worsening,” said Oswald.
Tenants reported not being able to pay their utility bills on time, being unable to heat their homes and being forced to go without meals due to financial hardship.
While some landlords experienced a loss of rental income during the pandemic, most were able to manage the financial shortfall.
The report also found a large disparity in wellbeing between tenants and landlords, with reported stress levels of tenants being higher due to financial stress, future uncertainty and living conditions.
“The uncertainty weighs on your shoulders…it provides you with unnecessary worry in these times to try and find where you are going to get the funds to keep a roof over your head,” said one tenant surveyed.
Tenants who live in small dwellings or have multiple housemates found working at home to be challenging, despite some instances of stronger community bonds being forged.
They also fund that property defects and maintenance problems became a greater issue as they were forced to spend more time at home.
“It was clear from our findings that without this government support, many tenants would be in a significantly worse position, including potentially homeless,” Oswald said.
“Both landlords and tenants reported confusion, stress and uncertainty about what would happen when government financial support packages end.”
Landlords however, overwhelmingly reported that they did not feel government action adequately considered them.
“By focusing on improving the success of negotiations in the landlord-tenant relationship, both economic and mental wellbeing could be significantly improved,” Oswald concluded.
The report will provide a series of policy recommendations for the government. This will include recommending the introduction of a protective negotiation framework, policy flexibility on moving house to reduce the risk of homelessness and establishing a landlord hardship fund.
