Motions to Parliament

Private Members Motion – Housing Committee Motion into private rental market – 17 August 2022

By August 19, 2022No Comments

There is an overwhelming need for the select committee that I propose today.  As housing researcher Professor Peter Phibbs said just last month in describing Tasmania’s housing market as dysfunctional, ‘You can’t run a society where people can’t move to a place to be a teacher or a doctor because they can’t get a house’.  That is where we are at now.  When the private rental market falls over, the knock-on effect reverberates around all aspects of our life.

As members of parliament, it is our duty to act when we see dysfunction in society.  Without an affordable and accessible private rental market there cannot be a functional housing sector.  We need this committee to give us some clear pathways out of this mess.  That is what the people of Tasmania expect.  It is not just a job for the minister and the Government, it is the responsibility of all of us here elected to the parliament.

Describing aspects of our civil life as being in crisis is certainly getting a run at the moment.  That is because it is a fact.  The provision of even basic health, education and housing services, for example, are arguably at their most perilous since the end of the Second World War. 

How did it get to this?  We live in a prosperous country and it is hard not to get the feeling that our generation has blown it, that we are handing to our children and grandchildren a society in worse condition than when we received it.

I am not here today to solve all the world’s problems but hopefully to make just a start on one – the residential rental crisis.  As I have said, fix that and you will go a long way to fixing the rest of society, because affordable housing underpins everything we do.  What I propose here and seek your support for is a committee of this House that looks specifically and closely into the private rental market in Tasmania, which can only and legitimately be described as in crisis, a serious crisis. 

The electoral offices of all members here no doubt have, like mine, been inundated with the most heart-wrenching tales from ordinary Tasmanians falling foul of an out-of-control private rental market.  Spiralling private rents are forcing families onto social housing waiting lists where many languish for years. 

Make no mistake, it is not just a problem for those on welfare or low incomes.  This is also a problem for many tenants who would normally be thought of as quite comfortably off because they too are being priced out of the market and struggling to find a home when vacancies rates are at a record low.

While the state Budget did make investments in social housing, it unfortunately did not sufficiently prioritise ways to get private rentals under some sort of control.  It could have included common sense measures like limiting short stay accommodation to rooms in the owner’s principal place of residence, or an empty house tax to incentivise property house owners to either sell or rent their empty homes.  This is an initiative that has been adopted in cities as diverse as Vancouver and Melbourne where homes left empty for more than six months without a reasonable excuse are charged one per cent of the value of the property. 

The Tenants’ Union recently released data that identified that 192 residential properties across Hobart City Council municipality at a high chance of vacancy, 115 in neighboring Glenorchy City Council and 256 in Launceston City Council.  That is 563 residential properties that sit empty during a housing crisis.  By extrapolation, there are around 2000 Tasmanian homes empty right now.

I quote these figures at every chance I get but it is important to remind us that within our grasp we have the ability to put roofs over Tasmanians’ heads.  It is not all too hard.  If these were released to the rental market, some of the demand would be soaked up and pressure on rents would be eased.  The Government does not see it.  Instead we have housing initiatives that are in the Budget that are doomed to failure.

Chief of these is the first home owners grant, which simply economic stupidity, piling mistake on mistake by extending the $30 000 grant for another year.  As any economist would tell you, these types of incentives do little more than inflate property prices by the amount of the grant.  In other words, such schemes make housing less accessible, not more – the exact opposite of an affordable housing strategy.  Higher property prices force more people into the rental market which pushes up rents, and we are on repeat again.

As respected Tasmanian economist Saul Eslake said recently:

First home buyer incentives do nothing to increase the home ownership rate but inflate the price of existing houses and end up in the pocket of either vendors or the profit margins of builders and land developers.

More people are price‑saver private rentals and the social housing waiting list just grows and grows.

What really gets on my goat is that while governments of all persuasions dangle carrots for first home owners, it rubs salt into the wounds of private renters who would love nothing more than to be a first home owner but who simply cannot afford to save up for that deposit because the astronomical amount of rent they are paying, because of demand and supply issues in the private rental market, because of Government policies.  It makes we want to scream.

We have all be overwhelmed by desperate people grappling with soaring rentals.  I am hearing constantly from people who cannot keep up because the cost of private rental has sky‑rocketed.  People live in fear of rent increases that are coming in the hundreds of dollars.  I hear from people where rent takes so much of their income, there is nothing left at the end of the week to save for a house deposit, let alone anything else like food, electricity, fuel or medication.  Families that we would otherwise consider middle class are now trapped in poverty.  Nothing in life is more heartbreaking than listening to those who are sleeping rough, couch surfing or being shifted from shelter to shelter because a private rental is just a pipe dream.  There is seemingly no prospect of a home from Housing Tasmania.

The ripple effect of homelessness cannot be understated.  Someone who is homeless is more likely to have poor health.  Someone who is homelessness is less likely to engage in education and training.  Someone who is homeless is more likely to be caught in the criminal justice system.  This is all taxpayers’ resources, something that is avoidable.

We desperately need a private rental market that provides an affordable housing option for all families.  Currently the Government has failed here.  This committee is desperately needed to give parliament a direction to beat this problem.

Let me add a bit more statistical background from the 2021 census which further supports the need for this committee.  In the five years since the 2016 census, the Tasmanian population grew by 9.3 per cent while the number of private dwellings increased by only seven per cent.  To exacerbate matters, the number of households renting increased from 52 000 to 58 000, an increase of 11 per cent. 

A stark contrast is a cost for housing between owners with a mortgage and tenants.  In many areas now it is far more affordable to have a mortgage, even with interest rates on the rise, than it is to rent.  The Tenants’ Union collects data on rent increases.  It is worth reading into Hansard the comparisons between March 2017 and March 2022 because it gives an indication of the scale of the crisis.  As I read these figures out, I ask members to keep in mind that many Tasmanians are living on Centrelink payments. 

The weighted median rent for three‑bedroom properties in Tasmanian regions between March 2017 and March 2022: Greater Burnie, March 2017, $255 increased $350 in 2022, an increase of 37 per cent; Central Coast, $280 up to $400 a week, 42 per cent increase; Greater Devonport, $270 up to $363, a 34 per cent increase; rural north-west, $263 up to $350 a week, a 33 per cent increase; west coast, $170 up to $255 per week, a 50 per cent increase; Inner Launceston, $328 up to $470 a week, a 43 per cent increase, Outer Launceston, $300 up to $425, a 41 per cent increase; north-east, $220 up to $350 a week, a 59 per cent increase.  The poor people in the central north, $278 in 2017 up to $450 in 2020, a 61 per cent increase.  Central south, $270 up to $420, a 55 per cent increase; south-east, $328 up to $470, a 43 per cent increase; Eastern Shore, $330, up to $518 a week in 2022, 56 per cent increase;  Hobart city, $450 a week up to $600 a week, a 33 per cent increase; Kingston area, $380 up to $540, a 42 per cent increase; Glenorchy city, $330 up to $495 a week, a 50 per cent increase, far south, $293 up to $420 a week, a 43 per cent increase.  The Tasmanian average in March 2017 was $300 a week.  In March 2022, it was $450.  That is a 50 per cent increase.

As we near the end of 2022 I guarantee that weekly rents are even higher now.  It is no wonder that housing stress is more prevalent in rental households than in mortgaged households.  Of households renting in Tasmania, 34.2 per cent pay more than 30 per cent of their income in rent whereas only 10.1 per cent of households with a mortgage pay more than 30 per cent towards their mortgage. 

What is the outcome of skyrocketing rents?  Skyrocketing demand for social housing.  The waiting social housing list, as we know, has blown out from 2310 applicants in 2012-13 to 4453 in June 2022 that is a 92 per cent increase in nine years.

The Government’s main focus is to see 10 000 new homes built over the next 10 years.  Laudable as far as it goes but I can only agree with the TasCOSS CEO who points out we are not able to get those homes on the ground quickly enough so much more needs to be done to make sure we get people housed. 

Affordability is only one aspect of the crisis in the private rental that this committee can inquire into.  I am sure that if we went around this Chamber every member of this House could speak of constituents who have come to them in desperate and worrying situations with their private rental.

People tell me they are living in substandard conditions because they are too frightened to ask their landlords to fix something because they are worried it might prompt a rent increase or at the end of their lease they will be asked to leave and they will struggle to find somewhere else.  I constantly hear of people trying to justify to themselves, living in the most appalling situations and conditions, that that is better than having no roof over their heads.

This is Tasmania, not a third world country.  We must do better.  Disturbingly, I have been hearing about people in our multicultural community who have been subjected to intimidation and harassment from their landlords because of their ethnicity.  While this contravenes so many laws including a tenant’s right to quiet enjoyment to their property, these families are too frightened to speak out.  They say they put up with racial harassment because it is better than being homeless.

Not good enough.  The market is so competitive.  If you leave or lose your existing rental property finding another is damn near impossible.  We have all heard of 50 plus tenants rocking up to an open home, all desperately seeking to be a successful applicant.  This committee, if established, could look at how we protect these very vulnerable Tasmanians.  How can we strengthen our residential tenancy laws so tenants can have the basic human right to housing without having to compromise on third world conditions or being subjected to disgusting acts of racism?  This is where the select committee can make its contribution:  it can ask the tough questions and get the answers to find, as its terms of references requires, reports on mechanisms to support Tasmanians experiencing housing stress and attempting to enter the private rental market.

There should be no doubt in any of our minds that the private rental market is in crisis.  We must act now to fix it.  I am sure, in other members’ contributions here today, they could also give examples of people they have spoken to.  I am also aware that a number of my colleagues here have been calling for a review of the Residential Tenancy Act.  This is a committee which would make a very good start and help inform where there are gaps, with experiences of ordinary Tasmanians.  Every day that we delay, that is another day on a freezing park bench or the backseat of a car, or someone worrying about their housing security for a fellow Tasmanian.

Of course, there is no silver bullet; no one bright idea that suddenly makes private rentals more affordable and accessible.  That is what makes the committee’s work so important and necessary.  We can come up with a strategy to get on top of this problem and that is a lot more than we have right now.

Mr Deputy Speaker, I commend the motion to the house.

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