The number of “perpetual tenants” is growing – News online

The number of sub-tenants in Australia is steadily increasing in all state and territory capitals, according to the latest research. The data shows that the upward trend is evident despite the majority of people still saying they would rather own a property and aspiring to do so.

The report, published by the Australian Institute of Housing and Urban Research’s Independent National Research Network, looked at short- and long-term housing trends in Australia and the preferences of residents for their housing situations.

Although the majority of Australians still own houses or flats, between 2011 and 2021 the number of owners decreased in all age groups except for Australians over 80. The authors of the report state that renting was once considered a transitional state for many people on the road to home ownership, but that is no longer the case.

“The landscape of rental property in Australia is very different in 2024. Many Australians are not progressing towards home ownership and a significant proportion of them will be leaseholders for life. The rental sector no longer represents a simple transition period,” the report states.

Although data shows that as many as 80 per cent of renters still aspire to own a house or apartment, property prices across Australia are seen as the biggest barrier to renters buying their own roof over their heads. Securing a home loan deposit of at least 10 percent is difficult for many.

Hence the devastating fact that as many as 59 percent of respondents, or three out of every five people, said that they are not sure that they will ever be able to afford to buy a house. Only 22 percent believe it to some extent, while ten percent of those surveyed are “moderately certain” that one day they will still buy real estate. Only seven percent of the participants in this research firmly believe in this outcome.

How much the situation has really worsened is shown by the data of the Australian Bureau of Statistics (ABS) that the salary index, which measures their growth over time, has increased over the past decade by 24 to 30 percent – depending on the location in Australia. On the other hand, in some places the median house prices have increased by two or three times the rate in the same period.

In Victoria, for example, wages have risen by 27 per cent since September 2014, while median house prices outside Melbourne have risen by 100 per cent over the same period.

Overall, tenants are also getting older, so among those who rent there are more and more pensioners with limited incomes. Therefore, the authors of the report say that the needs of this group will have to become one of the focuses of the national housing policy.

Long-term security

Home ownership is still the ultimate goal for 80 percent of tenants, although there are more and more younger people who tend to be more inclined towards the flexibility of renting. Australians want to own the properties they live in for long-term security, housing quality and conditions, and to be able to modify them to their liking. They also very much want the freedom to own pets, regardless of whether they currently have them or not.

Many are willing to pay more

The authors of the report also found that many subtenants are ready to pay more rent for the sake of certain benefits. For example, for an apartment above the minimum standard, tenants are willing to pay $127 more per week, for rent that cannot increase by more than five percent per year, tenants would pay $77 more per week, and for the possibility of extending the lease indefinitely – $72 more every week.