New wave of rental stress and homelessness three months after COVID moratorium lifted, report says

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Tricia Ray-Kepa has managed to turn a rundown 3 x 1 rental on a noisy thoroughfare in Perth into a charming home, despite its shortcomings.

It is packed with vintage furniture, art and plants, but it is badly needing repairs and there is no air conditioning so it can be boiling in the summer.

The couple cook on a portable gas burner because, they say,  the ageing electric cooker is faulty, while the rest of the kitchen is old and shabby.

They put up with all of that because the house, by Perth’s standards, was cheap at $350 a week and is in a good location in the leafy suburb of Mount Claremont.

But, about a month ago, the couple got a nasty shock.

“My real estate [agent] called and he just said ‘Tricia, are you going to stay or are you going to go?’,” Mrs Ray-Kepa said.

“He said, ‘because we’re going to lift the rent, $100 a week extra’.

“I suddenly felt very stressed and anxious.

“You’ve got to suddenly start saying, oh my goodness, what can we cut in our budget?”

Mrs Ray-Kepa says she was told they would have to be out of the house in 28 days if they did not agree to pay the extra $100 a week.

Since then, the couple has managed to negotiate down to an increase of $75 but still say it is more than they can afford.

Mrs Ray-Kepa is one of scores of tenants who have flooded legal and financial services since the state’s COVID-19 rental moratorium – which prevented landlords from increasing rent or evicting tenants – ended in March.

“I rang [community legal service] Circle Green because I wanted to know my rights, it didn’t sound right that we had to be out in 28 days,” Mrs Ray-Kepa said.

Her real estate agent, Sam Zeedan, sees it differently, saying the rent has not gone up at the property for the three years since Mrs Ray-Kepa moved in, while the owner’s rates and water rates had increased.

He said Mount Claremont was an expensive area with houses starting at $500 per week and he believed Mrs Ray-Kepa had been looked after.

Late on Wednesday Mr Zeedan told the ABC he was now trying to negotiate with the owner to limit the rent rise to $50 per week.

A report being released on Thursday paints a dire picture of soaring rents and evictions, three months since the moratorium was lifted.

The report by the Housing Emergency Response Group [HERG] says evictions have spiked and on average rental prices have increased by 15 to 20 per cent, while social housing waiting lists are growing.

[chart: rental evictions]

HERG was set up in April and represents not-for-profit groups and charities who say they are experiencing the full brunt of the impact of the end of the moratorium.

The Financial Counselling Network of WA says the number of clients seeking help has more than doubled since November to 889 clients in May 2021, with housing being the single  biggest reason for people approaching the service.

[chart: counselling]

Families ‘on the brink’

Circle Green Community Legal says it has experienced a 500 per cent increase in calls to 200 a day since the moratorium was lifted, but only half are able to be answered.

Circle Green Community Legal Client and Corporate Manager Carmen Acosta said tenants had been facing rent increases of between 20 and 30 per cent.

“A 10 per cent increase in rent would already bring so many families to the brink,” she said.

“We are now talking 20 to 30 per cent for many of these individuals.

“They can’t afford it, but they know that the alternative is that they can’t find another rental property.

“So they are accepting those new agreements knowing that they can’t put food on the table.”

Ms Acosta said demand for Circle Green Community Legal’s services had skyrocketed.

“We are only one community legal centre,” she said.

“Across WA there are 26 of us – so you can just imagine the increase in volume of individuals that are worried about their tenancies that want to ask question.

“We can’t respond to all of those calls.

“What is even more devastating is that with many of those calls there is no solution because there is no control on rents.”

Ms Acosta said more investment was needed in social and affordable housing solutions to prevent homelessness and housing stress.

WA still cheapest rent in country, industry says

A different perspective on the report has been provided by the Real Estate Institute of WA’s Damian Collins.

He said WA still had the cheapest rent in the country where 17.8 per cent of household income was spent on rent, compared to close to 30 per cent in NSW.

[chart: rental vacancy rate

Mr Collins said he did not accept that landlords were being greedy.

“Most people are being quite reasonable, most landlords are … negotiating with tenants and not necessarily jacking up all the way to where market conditions are,” he said.

“Even although we have seen some increases in rental evictions, we’ve got to remember there are 240,000 rental properties in Western Australia and where there are problems, there’s only a very small percentage.”

Mr Collins said there was a push to have limits or caps set on the amount that landlords could increase rent by but that he did not support the move.

“Rent caps, all they are going to do is make a bad situation worse,” he said.

“Anything you do like putting rent control in is only going to make investors not come into the market, it will make the housing situation worse.”

The report also stated that the number of people added to the By-Name homeless list in Fremantle and the Perth CBD had increased from 628 to 1041 since November, including 200 people since the moratorium was lifted.

The waiting list for public housing has also blown out, with the report showing that while the total social housing stock has fallen, more than 2,000 people had been added to the waiting list in the past year.

Government ‘acutely aware’ of market pressure

A spokeswoman for the state government said the Residential Rent Relief Grant Scheme (RRRGS), which was extended until December 31, had so far made more than 8,500 payments worth more than $11.9 million to struggling tenants and their landlords.

“The state government is acutely aware of the current rental market pressures and is working to increase private and public housing stock and provide financial support to those in need,” the spokeswoman said in a statement.

“This is undoubtedly a challenging time for some people, but the current statistics show the number of evictions have not dramatically increased since the rental moratorium ended.

“The Department of Mines, Industry Regulation and Safety is undertaking a review of the Residential Tenancies Act, including giving consideration to whether rent increases should be regulated, and will develop recommendations for government.

“No state government in Australia currently restricts the amount by which a lessor may increase rents.

“WA tenants can apply to the Magistrates Court if they believe a rent increase is excessive.

“The state government urges landlords to do the right thing and keep rent increases fair.”

By Claire Moodie and Rhiannon Shine (Original ABC Article)