Changes in the supply of and need for low rent dwellings in the private rental market

15 Jun 2004

This research project examines how the low rent end of the Australian private rental market fared between the 1996 and 2001 Censuses. During this period a number of significant changes affected the private rental housing market. Household incomes improved. Nationally, the growth in the number of households continued to outpace population growth as more and more small households formed. Inflation remained low and interest rates declined to their lowest levels since the 1970s. These trends contributed to a housing boom that began in the late 1990s (Productivity Commission, 2003) and, with it, to a worsening of housing affordability for many households (ABS, 2002a). Associated with Australia’s housing boom, there was an unprecedented level of investment in private rental housing. Coincident with these trends, housing assistance in Australia continued to shift away from the public housing sector and towards private rental as expenditures on rent based subsidies increased. Rising investment in private rental housing, alongside the continued reliance on the private market to meet the housing needs of lower income households, raise the question of how well the private market meets these needs.

To address this question, the research presented in this report builds upon an earlier study by Wulff and Yates (2001), which examined Australia’s private rental supply in 1986 and 1996. It updates and monitors changes in the supply of private rental housing by examining the data from the 2001 Australian Census and by comparing this with data from the 1996 Census. The earlier study showed that between 1986 and 1996, the Australian private rental market grew by a robust 34 per cent, but this growth generally masked gains in the top end of the market and losses in the bottom. The stock of low rent dwellings fell dramatically. At the same time, the number of low income households renting privately almost doubled. By 1996 these trends led to a national shortage of approximately 50,000 low rent private dwellings, with Sydney accounting for more than half this national figure.

Publication Details
Published year only: 
Geographic Coverage