The Australian government, due to its virtual freeze on the expansion of social housing, has created a situation where more and more older Australians are dependent on the private rental market for their accommodation. This article reports on a study based on twenty in-depth interviews with older private renters in Sydney. Interviewees told of their social exclusion and lack of capability. Having to devote such a substantial part of their income to paying the rent and the persistent fear of a rent increase had a serious impact on their physical and mental health. The lack of finances encouraged isolation. There were two key factors which determined their degree of social exclusion and capability – the actual rent being paid and the degree of support from family members. The experiences of the interviewees suggest that in the context of an ageing population and declining housing affordability the expansion of affordable and appropriate social housing for older people is a necessity.