- The Savvy Promise
At Savvy, our mission is to empower you to make informed financial choices. While we maintain stringent editorial standards, this article may include mentions of products offered by our partners. Here’s how we generate income.
In this article
Savvy delves into the July 2023 housing crisis survey data to learn what impact this is having on vulnerable Australians.
- Survey by Everybody’s Home shows two-thirds of Australians are experiencing housing stress
- Rents for a 2br unit have risen 44.1% since March 2020 (national average), with wages rising only 2.5%
98% say that they are concerned about the housing crisis - 95% of organisations say their workload has increased since the beginning of the housing crisis
Despite high inflation and rising interest rates to combat them, housing prices haven’t eased in kind. High demand and low supply have spurred on a housing crisis, where affordable housing is growing further and further out of reach.
According to a survey-based report by Everybody’s Home, a coalition of housing, homelessness, and welfare organisations to adequately address the housing crisis Australians face at current, rates of housing stress are climbing, there is major concerns about the ongoing crisis, and charity and financial aid services are struggling to meet the demand of those in crisis.
What is the current experience of Australians living with mortgage or housing stress? What support are they receiving? Is it enough? How are organisations and government working to reduce this stress, and what is their experience?
Here are the results from the survey as well as research from other contemporary sources.
Reasons for concern about the housing
crisis among community survey respondents
| Total | |
|---|---|
| Total | Participants (%) |
| Uncertainty about the future | 81% |
| Worry about financial security | 75% |
| Worry about mental health and wellbeing | 66% |
| Lack of access to suitable housing | 65% |
| Worry about physical health and wellbeing | 52% |
| Worry about the safety of your family or loved ones | 37% |
| Worry about personal safety | 36% |
| Loss of independence | 35% |
| Disruption to employment | 27% |
| Loss of livelihood | 26% |
| Lack of access to community facilities and services | 25% |
| Separation from loved ones | 23% |
| Disruption to study or training | 14% |
(Respondents choose all that apply)
Source: Brutal Reality – The Human Cost of Australia's Housing Crisis, (pg. 10)
Spending more than 30% of income on housing
| # Participants | % Participants | |
|---|---|---|
| Total | 749 | 100% |
| Yes | 503 | 67% |
| No | 246 | 33% |
Source: Brutal Reality – The Human Cost of Australia's Housing Crisis, (pg. 9)
Spending more than 30% of income on housing
(of respondents renting and in share houses)
| # Participants | % Participants | |
|---|---|---|
| Total | 361 | 100% |
| Yes | 295 | 82% |
| No | 66 | 18% |
Source: Brutal Reality – The Human Cost of Australia's Housing Crisis, (pg. 9)
Defining housing stress
Housing stress, rental stress, or mortgage stress all refer to a family, couple, or individual struggling to pay for their housing on an ongoing basis. By “paying for housing,” this not only means their individual rents or mortgage repayments, but rates (if applicable), taxes, house and contents insurance, repairs, maintenance, and other levies, such as those on strata-titled dwellings.
The Australian Housing and Urban Research Institute and the report uses the 30:40 method of indicating housing affordability stress. This means the bottom 40% in the income distribution of Australia are paying more than 30% of their income in housing costs. This assumes those in higher income percentiles who use more than 30% of their income to pay for housing make a conscious choice, as it has less impact on that household’s ability to buy other essential goods and services.
How many Australians are in housing stress?
According to the survey (n=749), 67% or two-thirds of respondents said they were experiencing housing stress, i.e., spending more than 30% of their income on housing. More than four in five renters are in rental stress, at 82%.
According to SQM Research, rents have risen from $365 per week (national average for a 2br unit) in March 2020 to $526 per week in January 2024 – an increase of 44.1% – while wages have only seen a 2.5% increase (averaged out per quarter) over the same period.
Due to rents increasing at such a rapid pace, 18% of respondents to the survey said they were receiving Commonwealth Rent Assistance; 18% said they were receiving an alternate income support payment; 12% said they were waiting for community housing to become available; and 7% said they are already living in public housing.
81% of those on income support said they were paying more than 30% of their income on housing.
Homely spokesperson - David Webb offers his thoughts;
"Financial pressures are being felt across the board, and this is making people rush into decisions, which can make existing issues worse.
The main problem stems from the supply chain, which is struggling due to high building and upkeep costs. More people want homes than there are homes available. Builders have to warn customers that prices could jump by up to 30% from a year ago.
Meanwhile, property owners are selling their rental properties because they don't see them as good investments anymore, especially with high interest rates and expected government rules. This reduces the number of rental homes available even more, making the housing situation even tougher."
Australia’s greatest concern
Since rates of housing stress are so high, almost all – 98% – said that they are concerned about the ongoing housing crisis in Australia.
Their top five reasons being, Uncertainty about the future (81%), worries about financial security (75%), worry about their mental health (66%), lack of access to suitable housing (65%), and worry about physical health and wellbeing (52%).
"The Australian housing crisis has reached critical levels, with rising property prices and rental shortages placing increasing strain on households nationwide. This ongoing crisis has made homeownership feel out of reach for many Australians, while renters face mounting pressure with limited affordable options. Urgent action is needed to address housing supply and affordability, as well as to ensure stability and security for those struggling to find a place to call home."
Isabelle De Braux, Soho.com.au
Organisations dealing with the housing crisis
There are many non-government and government organisations trying to mitigate the housing crisis or deal with its effects, such as people finding themselves homeless. According to data from the Australian Institute of Health and Welfare, almost two-thirds (63%) of those requesting assistance were turned away due to a lack of available accommodation.
As such, 95% of those in housing stress-related organisations have reported an increased workload since the beginning of the housing crisis.
This has impacted the organisations in many ways. The top five impacts on organisations being an increased casework complexity (89%), not being able to provide long-term housing (79%), increased waiting times (73%), an inability to meet client needs (67%) and staff burnout or attrition (61%).
These impacts have serious implications for clients in need of housing or housing stress relief. 67% of organisations say that it leads to homelessness. The flow-on effects also mean clients are unable to afford their rent or mortgage (57%), have ongoing mental health problems (41%), are unable to leave unsafe home environments such as experiencing domestic violence (33%), and ongoing financial stress (28%).
This has also impacted the staff and volunteers in housing crisis relief, with 94% saying it has affected their mental and sometimes physical wellbeing. In fact, some staff also struggle with finding adequate housing for themselves, effectively competing against the clients they are there to help.
What can be done?
Without increased supply and other methods of bringing housing affordability into the view of the bottom 40% of Australians, there is no real end in sight for the housing crisis. We can only hope that the economy doesn’t experience any sharp shocks like it did during the post-COVID era and help drive up wages while supressing inflation.
Did you find this page helpful?
Written by 
Reviewed by
Reviewer
Bill Tsouvalas
Commentary by
Guest Contributor
David WebbFact checked
This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.
The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.
