Young Irish heading down under will find Australia is also in the grip of a rental crisis

When I first went to Australia at the age of 20, getting rental accommodation was not a big problem. There were share houses, apartments and all manner of housing options. Fast forward to 2023 and the picture has radically changed. Demand far outstrips supply. Rents have jumped, forcing low-income earners out of the market, and stories such as those reported by the national broadcaster ABC last week detail how people are being forced to live in tents and caravans in some parts of the country.

As reported last year in the Guardian Australia, the private rental market was the “epicentre of Australia’s housing affordability problem”.

A report by Australia’s Productivity Commission, “In need of repair: The national housing and homelessness agreement”, found the country has a housing affordability problem that meant Australians, particularly those on low incomes, were spending more on housing than they used to.

Indeed, the report went on to say that “many low-income private renter households spend a large share of their income on rent”.

Demand for social housing, as the report details, is rising, and more people are seeking help to avoid homelessness. Added to this, home-ownership rates are falling, particularly among young Australians.

What is the Australian government doing about it? Well, a national housing and homelessness agreement is in place, aimed at improving access to affordable, safe and sustainable housing, but the commission’s report details that it has been ineffective and “does not foster collaboration between governments or hold governments to account”.

Affordable housing has been an issue in Australia for at least the last 10 years, with the average house price rising to $955,000 in Sydney – by way of comparison with Ireland, that’s nearly €620,000. This, of course, will not buy you a house in the inner city or the plush suburbs of Bondi – it will more probably get you a place in the outer western suburbs.

This has led to a generation of young people living in rental accommodation far longer than a generation before. High rents and unaffordable housing removes keystone events and delays young adults in their life journeys.

The report – and it is worth reading – detailed how housing was a basic human need and was central to our physical and mental health and quality of life.

Addressing the unaffordability in the private rental market, the Guardian said it was “critical to increasing access to safe, affordable and sustainable housing”. Now, as the crisis worsens, renters are bidding on potential rental accommodation before they have even seen the property.

ABC detailed how the median cost of a rental in Australia went up by 10.2pc in a year. In Melbourne, rents were up by 9.6pc. The CoreLogic report also showed the vacancy rate in Melbourne “was 1.1pc in December last year, compared to 3pc at the same time 12 months before”.

With rents so high, young people in Australia are finding it harder to get the money together to buy their own homes.

Moving to regional and rural areas was always a safety net, but as ABC reported in an in-depth analysis last year, vacancy rates were functionally zero – less than 1pc in some areas of the countryside.

Australia is a great country with great opportunities, many of which I grasped with both hands while living there, but it too has a housing problem. It’s different in its make-up to the Irish model, but no less severe. While wages are high in many sectors, so too is the cost of living.

As Australia becomes a gateway for so many graduates in this country to go and explore the world, the message needs to come back that it is an expensive place, a country that has opportunities but also problems.

The commission’s report outlined some key recommendations for the problem – that the Australian government review rent assistance as a priority; that states and territories commit to firm targets for new housing supply; and that the $16bn governments spend on direct housing assistance could achieve more if it was better targeted to those in greatest need.

The affordability concerns in Australia reflect our own experience in this country. Where the Australian crisis leads is unclear. Hopefully, things will improve, but for a great many people I know there, renting is part of their life for the long term. For our young people migrating there now, we must arm them with the knowledge that Australia can be costly.

For Australians, a new government was elected last year under a Labor prime minister, Anthony Albanese. The party put forward various plans to tackle housing and homelessness during its election campaign. Perhaps Mr Albanese and Labor will have better luck in dealing with the problems and ensuring people can access that basic human right to housing.