Housing affordability continues to decline across region

COASTAL towns are among the least affordable regions in Victoria and several local townships are now considered unaffordable for the average regional Victorian family earning a gross income of less than $85,000.

According to the 10th annual Rental Affordability Index, released last week by National Shelter and SGS Economics and Planning, renters in Torquay, Barwon Heads and Ocean Grove have been significantly affected by declining housing affordability.

Rents in these regions have increased to more than 38 per cent of the average household’s income and are now classed as “severely unaffordable”.

Housing is considered unaffordable when housing costs consume a disproportionately high amount of a household’s income, that is more than 30 per cent.

Apollo Bay, which was considered affordable in 2019, now also has severely unaffordable rents.

Meanwhile, families living in areas such as Armstrong Creek, Anglesea, Queenscliff and Lara are spending more than 30 per cent of their income on rent, and much of the Bellarine Peninsula is regarded as “moderately unaffordable”, with households less likely to be able to easily absorb unexpected costs.

Tenants Victoria chief executive officer Jennifer Beveridge said there was no fixed method to calculate rent rises in Victoria and the non-profit had long urged the state government to introduce a “fairness formula” to guide the setting of fair rent increases.

Real Deal Geelong community organiser Sally Fisher said the number of people experiencing rental stress across the region, particularly those in Geelong’s north, highlighted the need for more social housing.

“I think it’s important to recognise that some of the worst housing stress is in the northern suburbs of Geelong,” she said.

“At our recent forum with [Deputy Prime Minister and federal Corio MP] Richard Marles, we heard stories from two northern suburbs residents who are experiencing the impact of a lack of supply of homes for people on low incomes.

“One woman shared that she was only spared from homelessness after family breakdown due to the generosity of a local benefactor providing her with a home.

“A second woman shared that she is living in a private rental which requires significant upgrades – it floods regularly when it rains – but has no option to move elsewhere due to the lack of social housing available and the cost of moving is also prohibitive.”

People on low incomes are among those hit hardest by the housing crisis, with a single person on JobSeeker facing “extremely unaffordable” rents that consume almost 60 per cent of their income and both single and coupled pensioners battling rents considered “unaffordable”.

SGS Economics and Planning principal Ellen Witte said Victoria’s rental market was “spiralling” and urgent government intervention was required to prevent more people being pushed into homelessness.

“What was once affordable is slipping out of reach for many.

“Households are being forced to live further away from their jobs to access affordable rents, causing fatigue and other issues in workers.

“After reaching a peak during the COVID-19 pandemic, most regional areas in Victoria have seen a decline in affordability and people on low incomes are suffering the most.”