When Jacob Sarkodee, 37, paid the bond for his first rental in 2008, he never expected he would be fighting to find a safe and affordable rental for his family of seven almost two decades on.
Sometimes, walking around his suburb in Sydney’s inner-west, he feels the judgement of others about starting the large family he adores.
“If you have three or more children, you’re almost a curious experiment,” Mr Sarkodee said.
“An older person at the shops once turned, once seeing me with my five kids going shopping, and laughed and said, out loud, ‘what were you thinking?'”
Since that first rental, Mr Sarkodee’s family has moved 10 times, eight of which have been when his wife was pregnant or they had children.
The Sarkodee family is among a growing cohort of Australian renters who fear their dream of home ownership may be out of reach.
Home ownership in Australia has been falling for decades — about 66 per cent of Australian households currently own their home, while about 31 per cent rent.
“For us, it’s just about having a place that where there is certainty, where there is ability to have community,” Mr Sarkodee said.
“I don’t want to be a forever renter … [but it’s] somewhat out of our control, and that’s where we have to have courageous political leadership.”
Housing main source of wealth for most Australians
For Australians, housing represents most of our wealth, and experts have said that more expensive homes concentrated in fewer hands will create growing inequality and generational divides.
The issues surrounding expensive housing have hit renters — not just aspiring first home buyers — with vacancy rates at record lows and rising asking rents.
Over the past four years, rents in two of Australia’s most populous cities, Sydney and Melbourne, have increased by about 20 per cent, according to the Grattan Institute.
The public policy think tank found those on lower incomes, who were often renters, spent more of their income on housing.
Matthew Bowes from Grattan, who specialises in housing, said the rapid growth in prices over the past two decades had created a two-speed economy.
“Those people who are able to access home ownership, they see rapid appreciation in their wealth over time, which allows them to expand their purchasing power and purchase larger homes,” he said.
But those locked out of home ownership pay higher amounts of their income on rent without accumulating the same wealth over time through housing, Mr Bowes said.
“That’s just because you need wealth to see wealth grow,” he said.
The increasingly volatile rental market was a large reason why Mr Sarokdee decided to move back into the home where he grew up, when his parents moved interstate.
He still pays rent but it’s more affordable, helping him save for a home deposit.
“If we don’t somehow figure a path to more permanent housing, we’re just going to be stuck in this forever,” he said.
“If we didn’t do that, we wouldn’t be able to save or even have the option of thinking about saving.”
Forever renting means delaying or questioning having children
A recent report by the campaign group Everybody’s Home found that even middle-to-high income earners were facing rental stress.
It found a single person needed an income of $130,000 to comfortably afford the national weekly asking rent for a typical unit.
That reality is why 23-year-old Nicolas Roberston, who currently spends about half of his income on rent, feels pessimistic about his housing options for the future.
“I’m already considered to be in what’s called rental stress … So when I look at the election pitches made by both [major] parties, it doesn’t give me much security or hope,” Mr Robertson said.
Mr Robertson is questioning whether he’ll be able to afford to ever have children.
Australia’s birth rate is at an all-time low of 1.50.
“In my perfect dream, one day I’d be able to afford a home and be able to afford having children and being able to support them,” he said.
“But when I look at the way it’s going, I have much more fear and uncertainty about being able to live that dream.”
What are some solutions for renters?
Renters the ABC spoke with said they would find more security in renting if there were stronger protections for tenants.
These included long-term leases and a capping of rental increases per year.
University of Queensland’s Dorina Pojani, who specialises in urban planning and housing, said not everyone could become home owners and renting should not be stigmatised nor a scary proposition.
Associate Professor Pojani said she supported introducing rental caps in line with inflation, nationwide no-ground eviction bans, and the normalising of long-term leases over 12 months.
The rental caps would be tied to the CPI, which regulates prices on utilities in Australia.
“I think that’s better protection rather than each individual having to negotiate personally, because personal outcomes then can vary quite a lot,” Dr Pojani said.
“The market is not working properly because rents are going up faster than inflation. That’s a dysfunctional market.”
Loading…
Should Australia adopt the Swiss approach to renting?
Unlike Australia, home ownership rates in Switzerland have historically been low, with just over 60 per cent of people renting.
Swiss economist Philippe Thalmann, who specialises in housing, said the rental market in Switzerland had found a balance between persevering tenants’ rights and the interest of property investors.
It meant the building owner was able to set the price when the apartment was first rented, but once a tenant moved in, rental increases were much more difficult, Dr Thalmann, an associate professor at EPLF, in Lausanne, said.
“Because it’s considered important to protect sitting tenants. The reason is that sitting tenants are like sitting ducks on a pond,” he said.
According to Dr Thalmann, this stops arbitrary rental increases.
“The rent is not fixed, but it can vary based on costs. That is, if interest rates go up, landlords can raise the rent. Interest rates come down, they’re supposed to lower the rent,” he said.
“So the landlord cannot take advantage of the housing shortage.”
Loading…
Long-term tenancy was also common in Switzerland, with many renters staying in the same home for more than a decade.
Dr Thalmann, a long-term renter himself, said those who stayed in the same rental over many years would pay well below current market rents.
“So for [pensioners], it’s not, not a problem to pay that. Even the moderate pension is sufficient to continue paying the rent,” he said.
Life renting as a pensioner in Australia
Alison Manion, 72, believes she will be a forever renter. She’s spent the past three decades renting, during which she’s moved about 15 times.
Her most recent move was from North Queensland to find an affordable rental in Victoria.
Now in Kyneton in central Victoria, she pays about 57 per cent of her fortnightly pension to her landlord.
“I found the experience of trying to find somewhere to live when I was in North Queensland terrifying,” Ms Manion said.
“It was horrible because I just couldn’t work out what on earth I was going to do. And while I’m good where I am now, I’ve also left all my friends behind me.”
Loading…
The Australian Homelessness Monitor found the fastest-growing cohort affected by homelessness in the past six years were people aged between 55 and 64.
That number could grow in the next few decades.
According to the Grattan Institute, home ownership rates are predicted to fall for people over 65 — from around 80 per cent today to 65 per cent by 2056.
Ms Manion desperately wants to see changes around rental protection, especially because she falls just below the threshold for housing assistance such as social housing.
“I just want a place I can settle and that can be mine and like I can be comfortable and secure,” she said.
“Not [to] be worrying about having to move when I’m in my late 70s or my 80s.”
