rental housing – Michmutters
Categories
Business

‘Zombie’ homes are fueling Australia’s rental crisis, experts say

Real estate experts say Australia is experiencing a rental crisis that’s set to worsen without government intervention, and so-called “zombie” homes are fueling the problem.

A zombie home is a property that is occupied only part of the time – such as a holiday house listed on Airbnb – that is not available to rent on a short or long term lease but can generate large profits for the owner.

For example, a good property in a regional town, near the beach or one in inner Sydney could fetch $1000 for a weekend but just $800 on a weekly basis under a leasing arrangement, First National Real Estate CEO Ray Ellis said.

“It’s a lot easier to take your investment property out of the full-time rental mix and put it into the short-term rental mix which is basically AirBnB or weekend accommodation,” Mr Ellis told news.com.au.

“If you could get $800 a week by having someone there full-time but you can get $1000 for a Saturday and Sunday, and don’t have to go through all the extra legislation requirements, you’ll do it, because you’re making the same return,” he said.

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Throughout any city there’s “hundreds if not thousands” of zombie homes, especially in coastal areas, that are occupied one or two days a week, Mr Ellis said.

“There’s now too many occurring in most cities in Australia.”

The benefit for owners – apart from the financial element – ​​was not having the long-term commitment of dealing with renters, he added.

Zombie homes are widespread, with last year’s census revealing that during lockdown and while Australia’s borders were closed, there were more than 1 million unoccupied properties.

While it’s a win-win for landlords, renters are suffering with rents souring and long queues of desperate prospective tenants lining up to inspect properties. This has forced some to live in their cars, a motel or caravan – even couch surfing – to keep a roof over their heads.

“Investors are putting their properties out for Airbnb, but it’s taking rental properties away from renters and that lack of … properties available to rent is driving demand and prices up,” Finder money expert Rebecca Pike told 7NEWS.com.au.

PropTrack’s latest rental report for the June quarter found the number of renters per property listed on realestate.com.au had risen 28 per cent year-on-year across capital cities, with Sydney and Melbourne experiencing the greatest increase.

The number of rental listings in Sydney fell 21 per cent in the last year. The largest declines in listings were recorded in Melbourne (-25.7 per cent) and Brisbane (-24 per cent).

Overall, the number of new listings coming on to the market was 13.8 per cent lower than the decade average in June.

The strong demand for rentals and limited supply was leading to significant increases in advertised rent prices, the report found.

Rental prices in Sydney have grown by 6 per cent over the past year, after having fallen throughout the early part of the pandemic.

The median rental price for a house in Sydney is currently $620 a week and $500 for a unit.

Nationally, the median weekly rent for a house is $490 and $440 for units.

With higher land tax charges for investors and larger interest rates, many of these costs are being passed on to renters causing rents to rise even further, the report added.

Ms Pike told 7NEWS.com.au the rental crisis needed urgent action and would get worse over the coming months.

“We’re definitely seeing that demand for rental housing going up because we have so many more people coming into the country, whereas during Covid we really saw that drop,” she said. “There is definitely more demand at the moment, but there’s also less supply.

“Also with the RBA cash rate, if investors are paying more for their loans, they’re potentially passing that on to renters.”

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Categories
Australia

Renter forced to give up her cat under laws in South Australia, where landlords can refuse pets

When Jasmin Witham started renting in Adelaide, she was forced to make a heartbreaking decision.

In order to move into her new home in Clovelly Park, the 27-year-old would have to give up her kitten, Nina.

Even though more than 60 per cent of South Australian households own a dog or cat, the decision to allow pets in rental properties lies with the landlord.

Property owners can currently refuse tenants’ requests to own a pet and do not have to provide a reason for doing so.

As a result, Ms Witham, who has struggled with rental affordability over the years as a part-time student who lives with bipolar disorder and is on the Disability Support Pension, said she was faced with a difficult choice.

“We approached the landlord and asked to bring the pet with us and they said no, so I wasn’t able to bring my kitten with me to the new house,” Ms Witham said.

“It is still very upsetting, and I don’t see how having a pet or a smaller animal like a cat is detrimental in any way to a property, like if there is any damage there is a bond.”

A hand holding a smartphone with a photo of a cat shown on screen
Nina the cat went to live with Jasmin’s parents instead.(ABC News: Che Chorley)

The South Australian government is currently looking at modernizing the state’s residential tenancies laws which could see tenants allowed to rent with pets.

In 2020, new laws came into effect in Victoria which made it much easier for renters to own a pet.

Now landlords are only allowed to deny a tenant’s request for a pet if they receive approval from the Victorian Civil and Administration Tribunal.

Queensland followed in 2021 by updating its legislation and stripping landlords of the right to refuse pets in rental properties without a reason deemed valid by the state government.

In the ACT, tenants still require consent of the landlord to keep a pet on the property but tenancy agreements can no longer prohibit pets completely.

If the landlord wants to refuse a pet, they have to take it to the Civil and Administrative Tribunal.

Shelter SA executive director Alice Clark said the current legislation in place in South Australia is outdated.

“The number of pet rentals that is listed is very low in South Australia so yes I think we should catch up,” Dr Clark said.

“What we don’t want is tenants hiding their pets which we know happens frequently so it would be great to have that all done transparently and responsibly by both sides.”

Rental Crisis Jasmin Witham
Jasmin Witham is currently renting in Unley.(ABC News: Che Chorley)

Considering what she could afford, Ms Witham said finding a rental by herself was difficult and even finding a share house was hard.

“It’s difficult to be put onto a lease where a lot of landlords and agencies feel uncomfortable taking people getting social security benefits and will prioritize people in employment,” she said.

As Australia’s housing crisis worsens, Ms Witham hopes South Australia updates its laws to better protect both tenants and landlords.

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