Hobart coronavirus rent price drop benefiting some, but others fear the crunch that is coming
IT professionals Molly Steer and Sage Stainsby spent Tasmania’s coronavirus lockdown earlier this year working from home, squeezed together in a one-bedroom unit.
“There was very little space, so I was working out of the kitchen and Sage was in the bedroom,” Ms Steer said.
Frustrated with the situation, the young Hobart couple decided to look for another rental and noticed a lot of attractive, furnished houses at prices they could afford popping up online.
They couldn’t believe their luck when they secured a rental in one of Hobart’s most expensive suburbs, Battery Point.
“This is an ex-Airbnb property which is why it came fully furnished,” Ms Steer said.
“We were looking at moving prior to COVID and all of the real estate agents gave us the impression that we needed to offer more than the asking rent to be in with a chance,” she said.
“But during COVID, speaking to a couple of agents before we applied for this house, they were urging us to put in a lower offer because they were just desperate to get places rented out.”
Price drop fuelled by job losses
Some renters in Tasmania’s capital city have reaped benefits from a greater choice in available properties and a drop in prices.
Property research group, CoreLogic found the price drop was fuelled by job losses, the conversion of short-stay properties to long-term rentals, and a major reduction in international students.
“From the onset of the pandemic we’ve seen rental values across the Hobart market decline 3.5 per cent, led by units where rent values have fallen over 5 per cent,” CoreLogic’s head of Australian research Eliza Owen said.
Despite that recent decline, rental prices for Hobart houses and units have actually gone up 1.3 per cent compared with the same time last year.
Bella Fountain is the housing solutions manager at not-for-profit group Colony 47.
She is helping her clients deal with the changing market and said opportunities for a better quality rental had really only been available to those with money to spend.
“Unfortunately those properties came back onto the market at a much higher price point,” she said.
“They came back on the top end of the market which, of course, was great to increase the stock in the rental market but didn’t help those who were on a low to medium income or those receiving government allowance.”
Thousands draw on super to survive
Sole parent Tanya Farrell had to dip into her superannuation to meet her rent payments during the coronavirus pandemic.
She is one of thousands of Tasmanians who have collectively withdrawn more than $500 million from their retirement savings.
Ms Farrell has not worked since February.
“First and foremost I pay the rent, because if I don’t pay rent I won’t have a roof over my head for myself and my son,” she said.
“So that will always come first … if we run out of internet, big deal, we’ll play Uno”.
She has not seen cheaper places available to rent and she values where she is because of a “kind” landlord.
“We’ve learnt to cut back on expenses — instead of turning the heater up we have lots of blankets and doonas around the house,” she said.
Ms Farrell is determined to remain positive, but with her $10,000 superannuation withdrawal set to run out next week she is worried about what the future holds.
Anxiety increasing over rental future
Ms Fountain said those relying on Federal Government coronavirus payments like JobSeeker and JobKeeper, or State Government initiatives such as rent freezes and protection from eviction, were also fearful of what might be around the corner.
“To suddenly have an income that enabled you to pay for both rent and food and additional costs of medication or transport without that level of stress in your day-to-day life has been an amazing sense of relief in those people,” Ms Fountain said.
“The fear is about what comes next as those payments decrease; what if they can’t pay their rent? What if they get evicted from the property they’re in? And if they lose their current rental property, how do they find another affordable rental property?”