‘Chronic failure’: Sydney’s rental market approaching crisis level By Tawar Razaghi March 3, 2022 Sydney’s rental market has been described as a “chronic failure”, with the city’s vacancy rate dropping to its lowest level since November 2017. Freshly opened international borders have heaped further pressure on an already strained rental market, where the vacancy rate fell to 1.7 per cent in February (down from 1.9 per cent in January), according to Domain’s latest Rental Vacancy Rate Report. The tightest rental market in Sydney was in the Camden region, which recorded a vacancy rate of 0.2 per cent.Credit:Janie Barrett Sydney followed the national trend, with vacancy rates falling in most capital cities to a national rate of 1.1 per cent. Hobart’s vacancy rate is still the tightest in Australia, staying steady at a record-low 0.2 per cent, while Adelaide at 0.3 per cent and Perth and Canberra at 0.5 per cent were also at their lowest recorded point. Domain chief of research and economics Dr Nicola Powell said Australia was on the verge of a rental crisis. “There are some cities already in a rental crisis, when you look at Hobart and Adelaide, where it is so tight and has been tight for some time,” Dr Powell said. Rental demand will continue to sharply rebound following the full reopening of the international border to double-vaccinated visa holders and tourists after two years of closures, she said, adding the resurgence in demand will be predominantly seen in the two biggest capital cities, which are “destination hotspots”. Within Sydney, the tightest rental markets were dominated by far-flung areas due to a combination of factors, including city renters looking for more space and the shortage of rental properties as investors cash in on the property boom, according to experts. As such, Camden had the lowest vacancy rate of 0.2 per cent in February (down from 0.3 per cent in January), followed by the Richmond and Windsor region, which recorded a 0.3 per cent vacancy rate. Stone Real Estate Macarthur director Chris Philp said there was blanket desperation among renters in the region. “We’re at the point where we no longer need to advertise rental properties,” Mr Philp said. “I’d say about 70 per cent of our properties in the last three months are being leased off market.” Sydney’s overall vacancy rate fell to 1.1 per cent in February, the lowest level since November 2017 on Domain data.Crediteter Rae With almost a dozen applications on each property, he said he has enough prospective tenants leftover for future rentals. As a result, many local renters were either pushed out of Sydney or compromising on the rental property. “We’ve even got people who are now considering different suburbs they haven’t considered, they’re considering three-bedroom properties when they need four bedrooms. “It’s making locals either bunker down with family, or they’re moving further south again, considering Tahmoor or Wilton, because they’re forced to look at those. It’s halfway between Sydney and Wollongong, but it is a developing area.” Renters were also routinely offering above market rents and up to 12 months worth of rent in advance to secure a property, he said. It is a similar story on the Central Coast, where the regions of Gosford and Wyong were the next tightest markets in Sydney, with just 0.4 per cent of rental properties vacant in both regions. Ray White Bensville and Empire Bay’s rental principal Carley Eder said while more rental properties were added to the market, there was still very strong demand. “As much as we had the 12 [rental properties added] in January, eight of them were leased after that first Saturday,” Ms Eder said. “We’ve been in this market long enough, [renters] know what to do to get the applications at the top of the pile,” she said. In one instance, a four-bedroom house in Wamberal which needed new carpets and new paint, had an asking rent of $850 a week but prospective renters were offering up to $950 a week and someone offered 12 months rent in advance. The market is busier than ever, agents say.Crediteter Rae Ms Eder said they now had to manage landlord expectations and were placing rent guides on properties. Senior research fellow at UNSW’s City Futures Research Centre, Chris Martin, said it was not enough to call it a “crisis” anymore. “It’s been happening for so long and getting worse for low-income people in private rentals,” Dr Martin said. “It is a chronic failure of the private rental sector.” He suggested caps on rent increases in tight rental markets to protect renters from being priced out, rather than waiting for rental properties to be added to the market. “That causes distress and hardship for an extended period while people wait for supply. We should be looking at the regulation of rent. “It’s pretty straightforward, if the rent is going up by more than two per cent for a certain number of quarters, it gets capped.” The vacancy rate was only telling part of the story for renters, who have struggled with less choice and compromising on quality over the years, according to Leo Patterson-Ross, chief executive of the Tenants’ Union of NSW. “It is true to say we have been in a crisis for many, many years, and we are sinking deeper into it because we’re not taking the goals of housing the community of NSW seriously,” he said. “People are often pushed into making pretty deep compromises. That hides what’s happening, so it hides people experiencing the worst part. “[People] are making those compromises on their quality and that really means their safety. It’s on pretty fundamental things like thermal comforts, cost of utilities, the cost of disease spreading.”
Scott Morrison gives blunt assessment of property market: ‘That’s how the market works’ Ashleigh GleesonNCA NewsWire February 25, 2022 Topics BusinessAustraliaFederal PoliticsNewsTAS News Prime Minister Scott Morrison says house prices are rising, bluntly adding “that’s how the market works”, during an address to the building and construction industry. This is how the Australian prime minister addresses the housing problem.....
‘It’s all going up’: Workers face rental stress in key marginal seats By James Massola and Rachael Dexter March 6, 2022 https://www.smh.com.au/politics/fed...ss-in-key-marginal-seats-20220304-p5a1rb.html Surging rents and flat wages are forcing critical childcare, aged care and supermarket workers deeper into rental stress in four marginal seats that will be critical to the outcome of the next election. New research from the “Everybody’s Home” campaign group has found that workers in the seats of Flinders (Victoria), Gilmore (NSW), Bass (Tasmania) and Longman (Queensland) have seen the share of their income spent on rent rise by between five and 13 per cent between February 2021 and February 2022. Tania Maguire, 46, a single mother of two and aged care worker on the Mornington Peninsula. Credit:Chris Hopkins In practice, that means that these critical workers on the Mornington Peninsula, in Launceston, Wollongong and the NSW south coast in North Brisbane and on the Sunshine Coast are now scraping by on between $189 and $375 per week, depending on the sector, after paying rent. At the same time, polling of 3273 residents in the seat conducted by the Redbridge Group for Everybody’s Home found that 61 to 72 per cent of residents believed the federal government had not done enough to address housing affordability. A larger majority of 68 to 72 per cent of voters in these seats believed there was not enough social and affordable housing for people struggling in the housing market. These findings suggest that housing affordability, which Labor has promised $10 billion to tackle, could be a key election issue in these four seats. Everybody’s Home national spokeswoman Kate Colvin said aged care, childcare and supermarket workers were being “pushed to the brink of homelessness and poverty”. “I’m already frugal on food shopping. I do meal plan. I try and keep that to a minimum. But kids come up with unexpected expenses all the time.” Tania Maguire “People on modest incomes now have to fight tooth and nail to get a home and maintain it. It shouldn’t be this difficult to keep a roof over your head in a wealthy country like Australia.” Tania Maguire, a 46-year-old single mother and aged care worker who lives in Flinders, knows first-hand what its like to struggle with rising rental costs and insecure housing. She’s had to move twice in 12 months because of private owners wanting to move into the homes she was renting. The only way she could secure her current house for herself and teenage son and daughter was to offer multiple months of rent up front – which meant withdrawing money from her superannuation account. Tania Maguire says the cost of living outpaces her income despite child support and some government assistance.Credit:Chris Hopkins “It was my last resort. It was getting literally two weeks before we had to vacate,” she said. Ms Maguire works part-time as an in-home aged care worker about 25 hours a week at just under $25 an hour. Next month she will need to start paying rent monthly again and because her hours fluctuate each week she predicts at times her rent will be more than 50 per cent of her weekly income – well and truly beyond the definition of rental stress of 30 per cent, while passing through the threshold to qualify for Newstart or a healthcare card. Even with child support and some government assistance, Ms Maguire said the cost of living outpaces her income. “I’m already frugal on food shopping. I do meal plan. I try and keep that to a minimum. But kids come up with unexpected expenses all the time,” she says. “Food, petrol, rent – it’s all going up ... Wages aren’t though”. Ms Maguire said cost of living would be at the top of her mind for the upcoming election. “I think everybody is really looking closely at the politicians,” she says. “Especially because of these COVID and cost of living and the lockdowns, everything is going to come into play. “Everybody’s looking at the politicians to say, do better – you get paid the big bucks, you’re able to take holidays and take time off, you’ve got this great support system behind you. We don’t. You’re not supporting us.”
https://www.smh.com.au/national/nsw...-to-cars-floors-to-sleep-20220311-p5a3um.html Housing crisis worsens as locals turn to cars, floors to sleep By Natassia Chrysanthos March 13, 2022 The Northern Rivers housing crisis could quickly become a catastrophe, as flooding in northern NSW renders thousands of homes unlivable and forces people to sleep rough in a region where property prices have already soared at rates higher than Sydney’s in the past year. The NSW State Emergency Service has determined that at least 3000 homes are uninhabitable and 5700 are inundated due to the floods, which have mostly affected the Northern Rivers region. Thousands of people have been displaced and locals are sleeping in cars, caravans, tents, garage floors, evacuation centres and friends’ places. They include Mary Douglas, 23, and her father Carl, 63, who have been alternating between the floor of an evacuation centre, a van lent to them for 10 days by a friend of a friend and an air mattress in the car port. Carl Douglas has spent the past few nights on an air mattress with a leak in a garage, and his daughter Mary has slept in a van that has been loaned to them after their flat in Lismore was inundated.Credit:Janie Barrett They were invited to stay at a friend’s house, but felt they’d be imposing: she is already housing nine people in her two-bedroom apartment. “We’ve literally got what we’re wearing,” Mr Douglas said. The new wave of housing need compounds an already dire situation in a region where essential workers and less affluent locals have been forced to the fringes. Median house prices in Lismore, Ballina, Lennox Head and Byron Bay rose more than they did in both Brisbane and greater Sydney last year, according to Domain data. The median house price in Lismore grew by 40.3 per cent in 12 months, while in Ballina it rose by 37.9 per cent. Byron Bay’s median house price grew 45.7 per cent in the year to December 2021, and in Lennox Head it soared by 60.4 per cent. Queensland and New South Wales students unable to return to classrooms amid flood devastation Thousands of Queensland and NSW students are unable to return to school due to recent flood damage. It was the same story for rent prices. The median weekly asking price for a house in Ballina, Byron Bay and Lennox Head rose more than 20 per cent last year. In Lismore the median rent price rose 12.8 per cent, and in Casino it rose by 14.3 per cent. This is compared with a 9.1 per cent rise in Sydney and 1.1 per cent rise in Melbourne. Median rent prices for units in Casino and East Ballina also soared more than 20 per cent in 12 months. Tony Davies, the chief executive of the region’s largest homelessness provider Social Futures, said there was an “absolute crisis” before the floods, driven by COVID-19 migration from cities to the regions which had driven prices up and cleared rental stock. “There’s no avoiding the fact the housing crisis in this region will worsen,” he said. “If we lose [a further] 3000 homes from an area that has an acute shortage of affordable housing, there will be an absolute wave of community distress and major issues for wellbeing.” Barry Brice, 76, has no idea what he will do next. The retiree has been living at the Sunrise Caravan Park in Broadwater, which was destroyed. Mr Brice, who has lived in a bus for the past five years, was only weeks away from moving into a permanent cabin. But there are indications the park will never reopen. “It’s like an old people’s home, more or less. Everyone was kind and everyone looked after one another,” he said. “I don’t know how I feel, it’s worse when you’re old. I’ve got nowhere to go now. We’re all homeless.” Barry Brice had been living in his bus in a caravan park in Broadwater for the last five years. The bus is ruined, his possessions destroyed, and he has no idea where he will go next.Credit:Janie Barrett A coalition of peak bodies, including Homelessness NSW, the Community Housing Industry of NSW and the NSW Aboriginal Community Housing Industry Association, have said the North Coast needed an urgent government response as it had already been facing a housing crisis: about 250 people were on the priority housing waiting list at June 2021 and the private rental market vacancy rate was 0.5 per cent. The government has since announced a $285 million temporary housing scheme that includes rental support, mobile motor homes and “pods” for people to live in while rebuilding. It is also using recreation camps for temporary housing and has a plan to connect people with homes through private companies such as Airbnb. The first convoy of 120 motorhomes left Sydney for northern NSW on Friday, and NSW Premier Dominic Perrottet has indicated social and affordable housing would be the long-term solution. Mr Davies said the state government’s package was a good start but a massive investment in social housing was needed. “We’ve had politicians acknowledge the problem for a few years. We need the firm commitment [to build significant amounts of social housing] that cannot be reneged on, and that commitment needs to happen very quickly,” he said. He said the state government should also look at incentives to keep rental prices down. “The rental support money [in the package] is helping fund demand, but not supply,” he said. But the enormity of the challenge is worrying. Jo Grenfell works for North Coast Community Housing and is without a home to live in herself, having rented an apartment now damaged by flooding. She said her organisation had 900 social and affordable housing properties, serving 1000 tenants, that have been flooded. “They’re all at the evacuation centre. These are all people who are on Centrelink, have no money, life’s already hard enough for them. They’re in a lot of distress,” she said. “Our offices have gone under in Lismore CBD; we’ve lost all our IT systems and we’ve gone back to manual paper. It’s going to be a huge task to get all of these people in liveable accommodation again. Can you imagine tradespeople around here? It was already tough enough pre-flood.” Jo Grenfell is sleeping at the evacuation centre in Lismore, and wearing her only remaining clothes. She works in housing and is concerned about where her organisation’s 1000 social housing tenants will live, after their homes were flooded.Credit:Janie Barrett Chris Harley, a real estate manager at Ray White in Lismore, said he didn’t have any properties available to rent before the floods. “That’s not just here, that’s the entire Northern Rivers,” he said. “I don’t know where [people] go. They’ve to get supplies, their kids have to go back to school. When you lie down to think about it at night, your mind just goes ‘holy cow’. Thousands of people would be homeless.” Lyndall Murray, who lives in Evans Head which avoided flooding, said there were now tents in front yards and caravans in driveways as people were left with no options. “It’s been the poorest people who have been the most hit,” she said. “We need long term housing solutions for all these vulnerable people.”
"Live with it, it's how the market operates." Gummint has no intentions to address the issue other than cosmetic sticking plaster. Protect the landlords at all costs!!!
Meanwhile, in USA... A record high number of real estate agents are trying to sell a record low number of homes: ‘It’s like that Hungry Hungry Hippo game … except there’s only one ball’ Dominick Reuter Mar. 16, 2022 https://www.businessinsider.com.au/...eading-to-real-estate-inventory-crisis-2022-3 Real estate agents work an open house in West Hempstead, New York. Raychel Brightman/Newsday RM via Getty Images Since March 2020, the number of homes available to sell fell by 600,000 to just 376,000. In the same period, the number of new real estate agents grew by 156,000 to over 1.5 million. Demand for houses is so hot that a third of new listings go under contract in less than a week. On a sunny weekend in the Pico Rivera suburb of Los Angeles, more than 75 people lined up along Lindsey Ave for a chance to view a three-bed, two-bath home that had just listed for $575,000. “It’s like that Hungry Hungry Hippo game in the 1980s, except there’s only one ball,” real estate expert Logan Mohtashami told Insider. “The sheer panic of needing somewhere to live is hitting everyone.” Mohtashami, a former mortgage broker and lead analyst for HousingWire, says lines like the one on Lindsey Ave or the frenzy for a home in North Carolina are indicative of an inventory crisis unfolding across the US. US housing inventory had been declining slowly from its 2014 peak, until the pandemic kicked the market into overdrive bringing the number of monthly active listings from about 1 million two years ago to just 376,000 in February, according to the National Association of Realtors. “By the end of summer of 2020, I was like, ‘Oh god here it comes. Here’s the nightmare scenario,'” Mohtashami said. “Now that we’re in 2022, people have finally come to the realization that is a full-fledged national inventory crisis.” Meanwhile, with fewer homes on the market, there are now more real estate agents hoping to make a deal. Since the start of the pandemic, the number of new real estate agents has grown by 156,000 to over 1.5 million, according to the NAR, an increase that is nearly 60% larger than the two years before the pandemic. The combination of low upfront costs of a few thousand dollars and roaring market was attractive to new agents like Carolyn Lee, who told The New York Times she found herself battling a January snowstorm with clients to get an early look at a new listing. She still had to beat six other offers. “You have to be willing to do what it takes, especially right now,” she said. Early numbers from real estate data-tracking firm Altos Research suggest that inventory could be on an upswing ahead of the usual busy summer selling season, but that same data indicates median listing prices are on the cusp of topping $400,000 for the first time ever. The Altos data also shows that houses are seeing fewer price cuts than ever, and that one in three go under contract in less than a week. This diminishing inventory is also feeding a self-reinforcing cycle, since existing homeowners are reluctant to sell when there’s nothing for them to buy. Even so, it’s not a situation that can be solved by simply building more housing supply, Mohtashami argues, pointing to the construction boom that began in the mid 1990’s and still saw rising prices. The entire financial architecture of the US favors keeping home prices up, he says. Somewhat counterintuitively, inventory will only start to improve if demand begins to dial back a bit, probably due to higher borrowing costs from the Federal Reserve raising interest rates. “We need total inventory levels to get back to 1.52 million or 1.93 million just to be back to a normal market,” Mohtashami said. “Until that happens this is a savagely unhealthy housing market.”
Sydney second-least affordable place to buy a home in study of 92 world markets Melissa IariaNCA NewsWire Thu, 17 March 2022 https://thewest.com.au/business/syd...a-home-in-study-of-92-world-markets-c-6096504 Sydney is the world’s second-least affordable place to buy a home, while Melbourne is the fifth-worst, a new report has revealed. Sydney ranked 91st in affordability out of 92 markets in eight nations, the Demographia International Housing Affordability 2022 survey found. No market except Hong Kong reached that level of unaffordability in the 18 years of Demographia reports. Melbourne was the 88th least affordable of the 92 markets as housing affordability underwent unprecedented deterioration during the pandemic. It comes after a report last November found first home buyers in Australia need more than 10 years just to save a home deposit, highlighting the plummeting housing affordability. Sydney has ranked 91st in affordability out of 92 markets in eight nations. Ian Currie. Credit: News Corp Australia The report was presented by the Urban Reform Institute and the Frontier Centre for Public Policy, an independent think tank in Canada. It rates middle-income housing affordability in 92 major housing markets in eight nations: Australia, Canada, China, Ireland, New Zealand, Singapore, the UK and US during the September quarter of 2021. When it came to Australia’s mainland capitals, Adelaide ranked the next most costly place to buy a home in the 92 markets after Sydney and Melbourne, ranking 79th on housing affordability. This was followed by Brisbane (76th) and Perth (73rd). The report said the affordability range between markets in Australia widened substantially during the pandemic. All five of Australia’s major housing markets were also deemed severely unaffordable since the early 2000s. Australia’s five major markets were ‘severely unaffordable’. NCA NewsWire / Christian Gilles Credit: News Corp Australia The latest ANZ CoreLogic Housing Affordability report estimates that based on households saving 15 per cent of their gross annual income, it would take the typical Aussie household a record 10.8 years to save a 20 per cent deposit for a house. Nationally, housing values posted a 21.6 per cent rise over the year ending October 2021, based on the report released in November. It attributed the sharp rise in values to factors including record low mortgage rates, a substantial lift in household savings, a variety of stimulus from governments and improving consumer sentiment as Covid-19 lockdowns lifted. The Demographia report found the most affordable housing in the eight nations studied was in Pittsburgh, Pennsylvania, followed by Oklahoma City, both in the US.
Flipping heck! This house sold for $500,000 more in three months By Tawar Razaghi March 22, 2022 https://www.smh.com.au/property/new...ion-more-in-three-months-20220318-p5a5wc.html 27 Numa Road, sold just days before Christmas last year for $2,125,000, with a three-month settlement. The humble home had a pending development application for a duplex, which is rising in popularity. No sooner than two weeks after settling on the property, the vendor – a developer builder – re-sold it, this time off market, for a tidy sum of $2,620,000 to a fellow developer builder, making a paper profit of $495,000. You would be forgiven for thinking a major renovation or improvement had been made to the home, but apart from a pending development application for a duplex, it had remained untouched.