Landlords put on notice about rent rises   
Landlords have been warned they won’t be able to increase their rents any further because tenants are running out of money.


News.com.au
April 9, 2024

Landlords have been warned that renters have reached the peak of their spending power and will not be able to stomach further rent rises.

Economist Maree Kilroy of Oxford Economics said landlords who continued to increase their rents, on top of already high recent rises, faced an increased likelihood their tenants would have to vacate and find more affordable housing.

She pointed to new Oxford Economics research that showed national rents had reached a peak level of unaffordability and many tenants could not afford any further increases.   



“Rental affordability has deteriorated. The ability (of tenants) to take more rent increases has tapped out,” Ms Kilroy said.

Tenants were also beginning to adapt to the strained rental climate by forming more share houses while migration inflow – a key driver of rent rises – was expected to gradually wind down.

Byron Bay was deemed the least affordable rental market in the country.

Ms Kilroy noted that the market would remain tight for a considerable amount of time, but there were several forces that would work to ease pressure on rental prices in time.

One of them was potential interest rate cuts, Ms Kilroy said.





“Interest rate rises have been an increased outgoing for investors, but if rates are cut there isn’t that same impetus for a rent increase,” she said.

Oxford Economics noted in a recent report that “stress on household budgets has reached a level that will significantly limit the capacity for further rental gains”.

“On balance, we expect this to pass through to more modest rent increases at lease renewal,” Ms Kilroy said.


It comes as a study by MCG Quantity Surveyors revealed there were multiple markets around the country where tenants were typically spending more than half their income on rent.

The least affordable rental market – measured by the average gap between rents and wages – was Byron Bay in the north of NSW.

Other markets where the average tenant spent more than half their income on rent included the Kingscliff-Fingal region of northern NSW, along with Hope Island and Mermaid Waters on the Gold Coast.

Sydney’s least affordable rental markets tended to be in the west – including the Bass Hill-Georges Hall area, Greenacre and Condell Park.

Mike Mortlock, Managing Director of MCG Quantity Surveyors, said the study revealed “the harsh reality many Australians face — a reality where the dream of living in a prime location is increasingly out of reach due to the widening gap between wages and rental prices.”

whiteknight wrote on Apr 14^th, 2024 at 11:59am:


Warning them won't do a thing.

The greedy bastards will just keep increasing the rent - who's going to stop them, and how?

I've seen it first hand.

A woman I know was paying $540 for a small unit close to Perth.

Good tenant, and had been there for about 6 years.

The landlord put her rent up to $850 in one go.

She told the landlord she couldn't afford it, and so he told her to get out: "I'll find someone who can afford it".

Total arsehole.

greggerypeccary wrote on Apr 14^th, 2024 at 12:07pm:


How can a landlord raise it that much in one go? I was under the impression 5-10% rise is about it.

greggerypeccary wrote on Apr 14^th, 2024 at 12:51pm:


No caps anywhere, by the looks: https://propertyupdate.com.au/how-much-and-how-often-can-i-increase-the-rent-of-...

Quote:


Duh.

One of the things I’ve learnt as a landlady, is if a higher amount is charged, you have fewer applications to choose from….or…. One of two things will happen…
1. Someone or a couple will choose to pay the premium rent but have another couple not on the books cohabitating etc
2. Some may even sub-let rooms (putting individual locks on doors).
A house we just leased, is $110 below weekly rent of others similar, in area.
A happy and grateful tenant is worth it!
Less is more etc.
I had choices from whom to pick from.
This bs of other landlords forcing out a good long standing tenants that paid on time because they reckon they will find someone that’s willing to pay more?
An unknown vs the well known?
That type of greed will be their undoing!
I’m shocked to find there’s no cap in rental rises.
That’s a rental authority government playing stupid.
I thought they were supposed to be on side of the tenant?
Our tenants have always become long standing and secure with us.
If there’s a problem like hws needing replacement, we do it immediately!
Keeping tenants happy keeps landlords happy.
I hope many good landlords are still out there that don’t do anything stupid to lose their good tenants.
And I hope that not all us landlords are tarred with the same brush.

Jasin wrote on Apr 14^th, 2024 at 4:36pm:


Nope… not doing it.
Tenants are normal working peons like the rest of us, we are not wanting stress from tenants … then payments fall behind, then they vacate, then there’s gaps in income.
Then shifting out, shifting in … furniture marks everywhere…
Best to have happier stress free tenants that will stay long term and keep up with payments.
If tenants are stressed and financial problems arise… remember this… tenants problems become landlords problems.