Big Pandemic Impact On Renters

Written by Mark Rosanes - Your Investment Property Mag ( May 22 2020 )

The coronavirus crisis has hit Australia’s residential rental system hard. But how renters respond to the “new normal” can determine if they can overcome the challenges or not.

The economic disruptions created by the COVID-19 pandemic has brought unprecedented financial hardships to Australian workers. With many laid-off or had their work hours slashed, people have grown heavily concerned on how to meet their housing expenses.

Rental property website Rent.com.au has recently surveyed 1,600 Australian renters on how the global outbreak has affected them financially and what this meant for their future plans. The results, reflected in the info graphic below, were telling.

How does the COVID-19 pandemic affect renters’ ability to pay rent?

The government lock down drove many businesses to stop operations, almost instantly resulting in job losses or reduced work hours for many workers. In turn, this has severely affected tenants’ ability to pay rent.

The survey revealed that almost 60% of respondents were earning less due to the pandemic while a third admitted to completely losing their jobs. More than a fifth (22%) said that their ability to pay rent has been adversely impacted. 

Greg Bader, chief executive officer of Rent.com.au, said that while the shutdowns have been “devastating for many businesses,” there were specific industries – such as hospitality, tourism, and retail – that were hit harder than most.

“These are also the sort of industries that typically over-index with younger staff, the largest cohort of the renting community,” said Bader. He added that, although the federal and state governments enacted measures to support tenants during the crisis, there was still a level of confusion among renters in the terms of the relief packages.

This has led more than half (53%) of respondents to say that they would like to see more assistance from the government – with just 13% believing the support that the government has given has been enough. “Short-term protections such as a moratorium on evictions, or a deferral in rent, provide some comfort, but there are concerns that this is just kicking the can down the road. We hope to see the industry and government respond in innovative ways to support renters and the industry-at-large,” said Bader. “We need to understand that renters, who make up 30% of us, will continue to deal with the financial impact for months or years to come.”

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