Canberra is the least affordable city to rent in Australia, but from today, Canberrans experiencing financial stress or hardship paying their rent can apply for financial assistance from the ACT Government.
Applications are now open for the Rent Relief Fund, which provides a one-off grant for up to four weeks rent capped at $2,500. The Fund is open until 30 June 2024.
To be eligible for a grant under the Fund, an applicant must have a gross household income within the following limits:
- First adult: $54,643
- Second adult: $57,474
- Each additional adult: $20,905
- Each child: $18,127
The grant is paid directly to the landlord or to the grantor in the case of occupants.
“The Fund will provide targeted, short-term support for people experiencing financial stress or hardship in the ACT’s private rental sector,” Attorney-General Shane Rattenbury said.
“The Fund is one way we are supporting vulnerable Canberrans and easing the stress for households worrying where next week’s rent will come from.”
Rental stress occurs when households pay more than 30 per cent of their household income in rent, and have liquid assets of $5,000 or less (excluding superannuation).
Severe financial hardship occurs when the household pays less than 30 per cent of their household income in rent, but have less than $3,000 in liquid assets (excluding superannuation).
Both have reached crisis point in the ACT. Canberra is the most expensive city to rent a house in Australia ($690 per week at the start of this month), the second highest to rent a unit ($560 per week), and, with greater Sydney, the most unaffordable capital city.
The latest Rental Affordability Index (November 2022) found that ACT rental households have the highest average gross income in the country ($123,566 per annum), pushing the ACT to the border of ‘acceptable’ affordability – but low-income households face unaffordable rents, pushed up by the overall high-income earning workforce.
Canberra is the least affordable location to rent for single and coupled pensioners, people on JobSeeker, single part-time worker parents on benefits, single full-time working parents, students, couples on minimum wage, and hospitality workers, and the second least affordable for dual and single income couples with children.
The ACT had the highest percentage of Commonwealth Rent Assistance recipients in rental stress for each of the five years between 2018 and 2022, according to ROGS data published in January. Last year, 53.9 per cent of CRA recipients in the ACT spent more than 30 per cent of their wage on rent in 2022, compared to 35.8 per cent in 20202 and 48.3 in 2019.
- Canberra still Australia’s most expensive city to rent a house (6 April)
- ACT leads nation for rent assistance recipients in rental stress (24 January)
- Canberran renters still pay the most expensive rent in the country (11 January)
- Low-income ACT renters struggle needing 117% of income to pay rent (29 November)
“Canberra is a unique place to be renting,” Joel Dignam, executive director of Advocacy group Better Renting, said. “There’s plenty of people in high, secure incomes, and this makes it a lot harder if you’re someone on a low income. We hear from many people who have simply been pushed out of the capital altogether, who’ve had to change their life plans and live somewhere else just so they can get by.
“A few things make rents high in Canberra. Part of it is higher incomes, on average, which of course just makes it harder for people on low incomes. Then it also comes down to supply and demand – when there’s more demand for fewer properties, landlords can cash in on rising rents.”
Canberra Liberals Mark Parton MLA, however, blames the ACT Government.
“Our housing affordability crisis has been exacerbated by the spiralling rates and land tax regime, the long-term strangulation of supply of land for detached housing, and the continual changes to residential tenancies legislation which continues to push investors out of the market,” he said.
- Canberrans being left behind with broken promises, again (28 February)
- Homelessness rises in ACT while social housing dwindles (27 January)
But the ACT Government hopes the Rent Relief Fund will make it easier for renters to afford to live in Canberra.
“The re-establishment of the rent relief fund is an important part of the government’s plan to support Canberrans with the rising cost of living,” Yvette Berry, ACT Minister for Housing and Suburban Development, said.
“A secure home is a foundation for people’s wellbeing. We know that the cost of housing can be a significant pressure for some households, and this additional support will go to those who need it most.”
Care, a community organisation that assists people on low to moderate incomes or who experience financial difficulty, will administer the Rent Relief Fund.
Care will also offer support services to help approved applicants manage their tenancies over the long term: financial counselling, financial capability, consumer law, community loans, and community education, and refer them to other local support services as needed.
The ACT Government announced in February that the new Co-ordinator General for Housing will oversee the delivery of the Rent Relief Fund.
Mark Parton was not impressed.
“Mr Rattenbury’s Rental Relief Fund is a bit like an arsonist turning up to the house fire that he started with a bucket of water to help put it out,” he said.
“Mr Rattenbury’s Greens colleague Mr [Johnathan] Davis pointed out during the last sitting that the housing crisis is worse here than most parts of Australia, but the government couldn’t quite accept that much of it is through their actions.”
Mr Davis moved last month for the ACT Government to acknowledge and respond to evidence that unrestricted short-term rental accommodation negatively impacts the supply and price of long-term rental properties. Chief Minister Andrew Barr amended most of his motion.
Better Renting welcomed the announcement of the Fund.
“The home is the foundation for a decent life, and helping people to stay in their homes is so valuable for our community,” Mr Dignam said. “This fund will be especially important for people who’ve got into hardship due to an unexpected event or a temporary setback, and will make it easier for people to get back on their feet.”
However, Mr Dignam believes the Rent Relief Fund would go further if the government paired it with measures to tackle rent increases.
“In the short term, stronger protections against excessive rent increases will go a long way to protect people from the harms of unaffordable rents,” Mr Dignam said.
“Currently, if landlords are renewing a lease, they can increase the rent by as much as they want, and renters have to just take it or leave it. A lot of people feel pressured to accept an exorbitant increase because they’re worried they’ll lose their home if they don’t. We need protections against rent increases that cover renters in this situation.
“It’s great the government wants to help people facing rental hardship – but they can also do more to stop it occurring in the first place.”
In the longer term, Mr Dignam said, the ACT needs a higher vacancy rate.
“It’s good to see Chief Minister Andrew Barr recognising this and talking about it as an objective,” Mr Dignam said.
Mr Barr has announced the government will build more affordable homes to own and rent, and support more build-to-rent projects. Alongside the Fund, Ms Berry said, the ACT Government will release more land, grow and renew public housing, and reform the Territory Plan to ensure more housing options.
Last month, Mr Barr floated the idea of reforming the ACT planning system to build more medium density housing – as the Missing Middle Canberra coalition proposes. The Housing Industry Association welcomed the comments, but said the government must act. Greens MLA Jo Clay, however, was disappointed that her motion to inquire into medium density infill was adjourned until after the new Territory Plan will be released.
- Territory Plan missing the middle, Canberrans call for housing change (20 February)
- HIA welcomes Chief Minister’s signals on ‘missing middle’ (17 March)
- Opinion: How should ACT build the missing middle? (31 March)
“We’ve supported the ‘Missing Middle Canberra’ campaign because we believe that legalising more housing supply in the ACT will mean more places for people to live, helping to shorten those queues at rental inspections and lower rents,” Mr Dignam said. “The ACT Government can also contribute to this directly through building more public housing.”
For information on how to apply to the Rent Relief Fund, visit Care’s website (www.carefcs.org) or call 0423 161 727.
