Queensland tenants under pressure as rents rise amid pleas for compassion from landlords
Queensland is being marketed to the world as the sunshine state, rich in resources and the future golden home of the Olympics.
- Queensland rents rose an average of 9% for flats and 13% for houses in the year to July
- The Tenants’ Union call center responds daily to calls from distressed tenants about rent increases
- Alternative rental accommodations are so scarce that tenants are often reluctant to complain
Last year, the state’s population grew by 50,000 interstate migrants, and at the same time, a two-speed real estate market resulted in a nightmarish market for renters.
In the 12 months to July, tenants in Brisbane faced an average rent increase of 9% for apartments and 13% for houses.
Add to that the return of overseas migration, low vacancy rates and a crisis in building supply, and the state’s tenants union says it faces a rental crisis where landlords hold all the power.
Cairo Sauvage is in her twenties and lives in a shared apartment in Morningside with her partner and her roommates.
They are set to move after two months of uncertainty after their landlord asked them to renew their lease but did not give them a price.
Fearing the worst, the roommates began looking for new accommodation. At the last minute, the owner asked for an extra $40 a week, Sauvage said.
“In that time frame where he’s taken so long to come back, my roommates and I were like ‘we feel like it’s going to go up’. [In the end] we thought it was going to go up more than it did,” he said.
“We started applying for new places. We were approved for a place, so we decided to move.
“Living with other people has its ups and downs, but it does bring the cost down. Finding a place that’s a room to a dwelling is [more than] $350, so it wasn’t doable.”
“Rent-vesting” because mortgages are too difficult to maintain
Mr Sauvage has a unique perspective on the rental crisis as a ‘renter-vester’, where he lives in a rental but owns a house in the inner Brisbane suburb of Windsor.
He bought at the height of the housing boom last year with money he had received through inheritance.
But he can’t afford to live alone in the house and sees it more as a long-term investment.
“I managed to get something that was a little out of my price range, and that’s why I made an investment in it,” he said.
Now a landlord himself, he said the tenants had little power in the arrangement.
“It’s really up to the landlord, and that’s what I don’t think is fair…how much he wants to take care of his property and the general well-being of the tenant,” he said. .
“If the tenant is terrible, the landlord has the power, based on our current law, to evict them. If a landlord is terrible, the tenant doesn’t have much to fall back on.”
How COVID has changed the rental market
CoreLogic economist Kaytlin Ezzy said COVID had reshaped the way Queenslanders choose to live and that was having lasting consequences.
“Thanks to COVID, we’ve seen household sizes go down. There are more single households, because people didn’t want to be cooped up with roommates, so that’s having a really strong impact,” she said. .
“Anecdotally on COVID, we’ve seen many first-time home buyers leave the family home and buy their first property at the same time rental yields were some of the lowest on record.
“For the housing market, the outlook really hinges on how strong and how quickly the RBA raises interest rates. I think Brisbane will be slightly more resilient than the Sydney and Melbourne markets.
“We expect the declines in value to become more widespread and as such will affect more Brisbane markets as we move through this down cycle.”
She said pressure in the rental market is not expected to ease in the foreseeable future.
“Especially as overseas migration returns to that pre-COVID level,” she said.
Queensland tenants’ union, Tenants Queensland, operates an advice call center – QSTARS – for tenants, and its chief executive, Penny Carr, said it answers calls from distressed tenants on a daily basis.
“Just today, on our advice service, an elderly pensioner called us and told us her rent was going to go up from $305 to $450 a week,” she said.
“People want to keep a roof over their heads, so they will often prioritize rent, so they don’t have to turn on the heat, eat lunch, or go out.
“For these people, even with modest incomes, it’s really a tough choice…because they don’t have a lot of things they don’t already need.”
She said there were certain avenues of redress for tenants who were offered unreasonable rent increases, including raising the matter with the Residential Tenancies Authority and the Queensland Civil and Administrative Tribunal.
“The problem with that is that as a consumer you have to have a good knowledge of the market, but the other thing is that if the court doesn’t agree with you, you have a contract to fixed term that you have just signed.
“A lot of people won’t, they’re too scared to lift their heads, there are such low vacancy rates across the state that people are reluctant to enforce the rights they have.”
Meanwhile, the real estate lobby has backed its push for agents to issue severance notices with rental agreements, to prevent what it describes as potential “lifetime rentals”.
He said the recommendation was made because new state laws taking effect from October made it difficult for landlords to end periodic or monthly rentals.
On Saturday, Deputy Premier Steven Miles urged owners and agents to show compassion.
“It would be disappointing if parts of the real estate industry used these laws in a way that made people less safe in their homes,” Mr Miles said.
“The roof over your head is pretty much the most important thing, the first need, and I urge agents, owners and the tip body to really understand how important they are in the life of These persons.”