Highlights:
- The recent quarterly rental report by Domain indicates that the national average rental price has reached the highest level in Australian history.
- International students are among those who have reported experiencing unlawful rental situations.
- Real estate agent Mercedes Morteani de Salinas likens the process of getting a rental property in Australia to winning an auction to buy a house.
Belén* (not her real name) recently had a “weird” experience at an open inspection for a rental property on the Gold Coast.
The international student alleged that the real estate agency who advertised the property asked her to pay one week's rent in advance as a "requirement" of lodging her application.
“Apart from all the usual requirements [for applying], we were told we had to pay a week's rent in advance, so that they [the agency] could review all the documentation," she told SBS Spanish.
"We were told that if everything was in order and they chose us, that money we paid in advance would be deducted from the final price, either the bond or rent.”
Queensland has become one of the least affordable states for renters, according to a produced by the Everybody's Home campaign.
According to Belén, the agent in attendance told her unsuccessful applications would have their deposit returned.
However, if an applicant was successful and subsequently didn't take the property, she alleged the agency would keep the money.
Belén said she was told this was the agency's way “to see who is truly interested in the property” and "avoid wasting time" reviewing the data of people who were not going to accept the offer.
But Belén said she became concerned because the real estate company “was asking for this money from all the people who completed the form”.
In the end, Belén and her partner decided against applying for the apartment since it did not meet their needs.
SBS Spanish contacted the Queensland Residential Tenancies Authority to find out if the practice described by Belén is legal.
In a statement, a spokesperson for the entity said that under the Residential Leasing and Accommodation Act of 2008, property managers or owners can only ask a potential tenant for a deposit of money if it's for a holding deposit, a key deposit, a rental bond or rent.
The spokesperson added that “the property manager or owner can only accept money for the lease (with the exception of a deposit to give the key to a customer who wants to inspect the property) after providing a potential tenant with a copy of the lease agreement. This ensures that the tenant is informed of the terms and conditions of the lease.”
According to the spokesperson's statement, “it is an offence for the property manager/owner to charge money from a potential tenant for any reason that is outside the list of reasons we just mentioned.”
The tenancy law in Australia varies from state to state.
In a statement to SBS Spanish, a spokesperson for the Commissioner for Residential Tenancies in Victoria said, "what is unlawful in Victoria may not be unlawful in Queensland", so people need to consult the information that applies in their jurisdictions.
SBS Spanish also contacted Better Renting in Victoria, a non-partisan community organisation.
"Certainly if somebody paid the amount and then was offered the property and didn't take it, if the agency kept the money that would be theft," the entity responded through a statement.
'Like going to an auction'
Access to decent housing is recognised by the as a right in article 25 of the Universal Declaration of Human Rights of 1948 and in article 11.1 of the International Covenant on Economic, Social and Cultural Rights of 1966.
Even so, obtaining adequate and affordable rental housing in Australia has become a major challenge particularly for people with low incomes, new immigrants and single-parent families.
Queensland real estate agent Mercedes Salinas. Credit: Supplied
"The applicant with the best profile, track record and income gets the property."
The recent quarterly rental report published by the real estate group Domain indicates that the national average rental price has reached its highest level in Australian history, with many properties costing more than $600 a week in cities such as Sydney.
And while some people may have the income to pay higher prices, the supply of residential properties for rent in many parts of the country is so low that it limits options for everyone.
“Unfortunately, people with low incomes suffer most, because the agents want to see that you can afford the rent, since now the increases [in rent] are happening monthly or weekly".
"We're seeing whole families and single mothers with children living in tents [in Queensland],” Ms Salinas added.
According to the latest figures, the vacant property rate around Australia fell again to 0.8 per cent in January 2023, reaching the lowest point recorded.
This sombre picture is aggravated by rising interest rates, inflation, the shortage of public housing, the low construction of new private housing and the increase in immigration.
New migratory flows have been gradually increasing since the opening of Australia's borders, intensifying pressure on the housing market, according to Westpac analyst Pat Bustamante.
“Demand is growing, particularly in areas along the East Coast capitals, where migrants tend to want to live. Cities like Sydney, Melbourne and Brisbane [are under greater pressure],” said the analyst.
The rental crisis has had a large impact on international students in Australia. Source: Getty / Getty Images
Rental scams
The strong demand and low supply of properties is creating another problem in the form of scams.
“People use [online] marketplaces to search for rooms and properties and that's where scams often take place," Ms Salinas said.
"[Scammers] ask people to deposit money before any inspection takes place and then they organise a date and time for the inspection. But when the person arrives at the address, after transferring the money, they discover the property doesn't exist,” she explained.
“They steal photos and addresses and set up fake profiles, and this is happening on different internet portals, such as Flatmates, Gumtree and Airbnb. A lot of money is being transferred and unfortunately people fall for it.”
She highlighted the importance of asking agents or real estate agencies for their license number. With that number, people can search the and find out if they are regulated and registered.
Gloomy outlook
The rental crisis in Australia shows little sign of improvement.
“For the time being, the market favours homeowners. It's a difficult market for current or future tenants, and this situation is not going to improve in the short term,” warned Martin Foo, from financial firm S&P Global.
A file photograph shows a view of the offices of Standard & Poor's in New York (AAP) Source: AAP
The plan was eliminated during Scott Morrison's administration and as a result it is estimated that by 2026 there will be about 36,000 fewer properties on the market, and that some 6,600 properties subsidised by the government will disappear.
The objective of the plan was to assist people with low to medium incomes - for example, members of the police force, nurses or ambulance workers - who are unable to compete in the rental market due to rising prices and low supply in many parts of Australia.
Prime Minister of Australia Anthony Albanese. Source: AAP
Since winning the election, it has committed to financing the construction of 20,000 social housing properties over the next five years.
But Ms Salinas believes that this plan will not provide enough housing to address the current crisis, especially in Queensland, where cut-throat strategies to compete for properties in the rental market are pushing many people to the periphery of society.
“Let's suppose that, for a house with three bedrooms, two bathrooms and a garage, the asking price is $560 a week. What I can do is talk to my client to find out if they can up the offer [so] instead of $560 we offer $580 and an additional four months of rent in advance. This is a practice that has now been adopted to maximise a client's odds of getting a property,” said the agent.
To listen to the full report in Spanish, click the play button below the title of this article.
