Changes in the private rental system and the effects of long-term private rental

Summary

An increasing proportion of Australians are now renting privately, many for over 10 years or more. Long-term renters experience higher levels of housing stress and are less likely to feel part of the community. Policy-makers need to respond to the needs of long-term renters, especially households with children and those facing retirement.

Project number: 50683
Research theme(s): Private rental
Project leader: Stone, Wendy
Funding year: 2011
Research Centre: Swinburne-Monash

Description



Private rental is increasing, especially long-term rental

There has been sustained, long-term growth in the Australian private rental sector in recent decades. In 2011, 1.8 million Australian households (or 23.4% of all households) privately rented their housing. A third of all private renters are long-term renters (defined as renting for periods of 10 years or more continuously), an increase from just over a quarter in 1994. Middle-aged cohorts living long-term in the private rental sector are now working their way up to become older aged renters.

Families with children increasingly rent
A high and growing number of private renter households include dependent children (727 012). An increasing percentage of long-term renters are households with children (30.0% in 2007–08), largely due to the increase in single-parent households.

Rates of housing stress have increased
Rates of housing stress among private renters increased from 1981 to 2011. Most recent data indicates that 62.6 per cent of long-term renters are in housing stress. Long-term renters experience very high rates of housing stress relative to other tenure groups, but have lower rates of mobility compared with shorter term renters.

Long-term renters are dissatisfied financially and don’t feel part of the community
Long-term private renters, particularly those on lower incomes, experience lower rates of satisfaction with their financial situation than other private renters or homeowners. They report significantly lower rates of satisfaction with feeling part of their local community than other tenure groups.

Policy needs to support aspects of long-term renting (e.g. lower mobility) that work well for renters but also effectively address the negative aspects (e.g. heightened levels of housing stress). Families with dependent children (especially single parents), and older middle-aged households ageing within the private rental system warrant special policy attention to avoid potentially large increases in demand for housing and other assistance in the medium-term future.

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Download now Positioning Paper: No. 149: The Australian private rental sector: changes and challenges
1330 KB PDF Document

Download now Final Report: No. 209: Long-term private rental in a changing Australian private rental sector
1.1 MB PDF Document