Perth residents spend 30 per cent of income on housing as city named least affordable for renters

In the middle of the workday, 30 people took the time to line the sidewalk of a Perth apartment building, competing to become tenants.

A crowd slowly wanders through the tiny one-bedroom, one-bathroom apartment in Rivervale, each hoping the others will be put off by the price.

But most would likely be willing to pay $550 a week, almost $200 more than the price four years ago.

That’s the reality for countless Perth residents after it was named the country’s most unaffordable capital city for renters, ahead of notoriously expensive Sydney.

Standing in the crowd of people was Michelle, who had four home openings that day.

“It’s horrible. Each rental has 30, 40, 50 people,” she said.

Sebastian, 19, said the prices were very high for what was on offer.

“Like this place here, it’s beautiful but there’s nothing special about it and it’s quite expensive for what you get,” he said.

Most of your salary goes towards rent

The Rental Affordability Index report from SGS Economics and Planning compares average rental prices to the incomes of 10 different types of low- and moderate-income households.

The report says Perth residents spend on average more than 30 per cent of their income on rent.

For the first time in history, two capital cities (the other being Sydney) recorded such a high percentage.

Before the pandemic, Perth was touted as the most affordable capital city for renters by a wide margin.

But rents in the city have risen 43 percent over the past decade, from a weekly average of $440 to $630, while rents in the Washington state region have risen 13 percent.

No quick fix

Housing advocacy group Shelter WA chairman Kieran Wong said Perth’s decline in rental affordability would not be easily resolved.

“This trajectory shows no signs of abating… that is the biggest challenge,” he said.

“There is not a single political figure who would be the driving force behind this process. There are a number of competing and complex factors.”

Shelter WA has been calling for tenancy reform for years and Mr Wong said the government should support affordability schemes as well as incentivize landlords to improve conditions.

“The legal environment in which tenants live and work is really not fit for purpose,” he said.

“People are having to spend beyond their current income to stay in the rental market.”

Imbalance of power

Separate report from Circle Green Community Legal surveyed hundreds of renters over two years and found many tenants in Western Australia put up with poor living conditions out of fear of becoming homeless.

The Make Renting Fair report found that almost two in five renters live in homes infested with pests, and almost three in five live in homes with leaks, damp or mold.

It also found that more than half of those surveyed reported electrical problems or problems locking doors and windows.

“We’re not just talking about inconvenience or discomfort, it’s actually dangerous,” said lead attorney Alice Pennicott.

She said the problems are exacerbated by the power imbalance between tenants and landlords.

“We know that tenants are desperate to keep a roof over their heads and are therefore putting up with the conditions because the alternative for a growing number of people is homelessness,” Ms Pennicott said.

“It has always been a problem that the laws are quite vague and difficult for tenants to enforce.

“When we’re in a market where tenants are at such a disadvantage… it makes it even more difficult and even more unbalanced for them to take action.”

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