The UNSW-ACOSS Inequality Partnership released a new report today that looks at the impacts of rapid policy changes made during COVID-19 on private renters and people experiencing homelessness. Produced by a team of housing experts at City Futures Research Centre and supported by the Shelter network and Mission Australia, the report documents the impacts of COVID-19 on rental housing markets and homelessness, the policy responses of federal and state governments, how they were formulated, and their outcomes.
A follow-up report due later this year will consider the legacy of these impacts and the lessons that governments can take from an extraordinary period of policy-making designed to secure peoples’ housing. Will we ‘build back better’? Or having now rode out the storm, will we simply clean up some of the mess and revert to ‘business as usual’?
Below is Shelter NSW’s summary of the report.
What is the report about?
The research investigated the impacts of COVID-19 on private renters and people experiencing homelessness, the policy responses of federal and state governments, how they were formulated, and their outcomes. A subsequent report is due later this year that will consider what lessons can be learned from these responses for on-going policy reform.
Who produced the report?
The reported was produced by UNSW City Futures Research Centre as part of the UNSW-ACOSS Poverty and Inequality Partnership which is supported by cross-disciplinary faculties at UNSW and ACOSS members. It was authored by Prof Hal Pawson, Dr Chris Martin, Dr Alistair Sisson and Dr Sian Thompson at UNSW Sydney. It also includes international contributions from Prof Suzanne Fitzpatrick from Heriot-Watt University (Scotland) and Prof Alex Marsh from the University of Bristol (UK). It was funded by Mission Australia, Queensland Shelter and National Shelter (on behalf of Shelter NSW and Shelter WA).
What research did it involve?
The research drew on a rapidly expanding body of COVID-related housing research and statistical evidence as well as the authors’ own primary research and analysis including: a literature review; interviews with government, industry and advocacy stakeholders; a survey of state government emergency accommodation activity; an online survey of private renters which was triangulated with findings from similar surveys; and international case study comparisons with policy responses in the United Kingdom, the United States, Canada, and New Zealand.
What did it find?
- There were eight key pandemic policy innovations that responded to rental market disruption and homelessness in Australia.
- Federal responses included the JobKeeper wage subsidy, the JobSeeker Supplement boost to social security payments, early access to superannuation, and facilitation of bank mortgage deferrals via the RBA and APRA.
- State and territory responses included eviction moratoriums, rent increase restrictions, rent relief, and homelessness emergency accommodation programs.
Rental market trends:
- Rental market trends diverged across the country by location, dwelling and tenure type.
- Median rents fell between 5-10 per cent across Sydney and Melbourne but rose between 5-6 per cent in regional areas.
- Vacancy rates doubled to 4.5 per cent in Melbourne but halved in Perth to under 1 per cent.
- Affordability for renters declined – rents nationwide fell 0.5 per cent but renter incomes fell 5 per cent.
- In contrast, affordability for purchasers improved – mortgage costs fell 5 per cent while purchaser incomes fell 0.2 per cent.
Rental housing policy impacts:
- One quarter of private renters lost income but multiple surveys indicate only 8-16 per cent got a rent variation.
- Similar proportions were refused variations, more were discouraged from asking, and more still opted to end their tenancy.
- Meanwhile, loan repayments were deferred on 12 per cent of private rental properties.
- A third of rent variations deferred rather than reduced rental payments.
- At least 75,000 tenants in Australia accrued deferred rent debts.
- Eviction moratoriums were generally well-understood and effective despite variations between states and territories.
- However, landlord-tenant negotiations lacked an adequate framework resulting in confusion and ongoing problems.
Homelessness policy impacts:
- There was no immediate increase in homelessness based on stable demand for specialist homelessness services – likely a result of income support payments and eviction moratoriums.
- Mass provision of emergency accommodation by four state governments benefitted at least 40,000 rough sleepers and other homeless persons.
- However, only a minority of homeless persons housed during the pandemic were subsequently assisted into long-term housing.
What observations did the researchers make of these findings?
COVID-19 has had uneven effects on housing markets nationwide. Lockdowns and remote working arrangements appear to have driven preferences for larger housing in outer-metropolitan and regional areas as evidenced by declining vacancy rates and rising median rents. Accordingly, rental housing may become less affordable and less available in these areas. Meanwhile, high unemployment and income loss appears to have hit inner-metropolitan areas hardest in being associated with increasing vacancy rates declining median rents. However, affordability remains a problem here too as renter incomes declined to a greater extent than rents.
Rental moratoriums coupled with additional protections and rent relief schemes appear to have restricted terminations for a core group of tenants. However, many renters chose to terminate their tenancies perhaps as a more certain option compared with the confusing and slow-to-roll-out rental variation frameworks. Arguably, though, the federal government’s main income support measures – JobKeeper and JobSeeker – let states and territories, and landlords, off the hook for adjusting rents by absorbing the larger income shock that would have otherwise hit the sector. Both levels of government will have to consider challenges facing tenants again as support measures wrap up in a still-weak economy – especially for those with deferred rent debt.
The combination of these and other policy responses almost certainly prevented the immediate jobs-and-health crisis from becoming an immediate homelessness crisis. By mid-2020, emergency accommodation programs in Sydney, Melbourne and Adelaide had practically eliminated street homelessness in those cities. Governments can in part attribute their success to engagement and rehousing efforts instigated before the pandemic, as well as greater willingness to reduce conditionality of support. Equally, though, the pandemic prompted fruitful collaboration with service providers that guided these responses and appear to have compensated for an apparent lack of housing policy capacity within government.
The emergency did not otherwise prompt major changes to social and affordable housing policy. The high-handed lock-down of public housing in Flemington and the initial response of the community housing sector to moratorium advocacy are cause of reflection. However, the insufficient availability of social and affordable housing was, and will remain, apparent for homeless people and lower-income renters. Notably, governments could only find longer-term housing for one third of the 8,000 former rough sleepers who left emergency accommodation by September 2020. Rising housing stress and homelessness are to be expected yet with the RBA forecasting unemployment to peak at 8 per cent and support measures due to end in early 2021.
What did the researchers conclude?
Australian governments were largely successful in preventing a surge in homelessness and greater disruptions to rental markets than would have otherwise resulted from COVID-19. However, they are now winding up key measures of support when many of its impacts remain a present threat including higher unemployment and reduced incomes, as well as deferred rental debt.
The report provides an in-depth understanding of what Australian governments did in response to the pandemic, how it came up with these responses, and what were their outcomes. A following report due later this year will consider what lessons can be learned for dealing with the outcomes of the present crisis, for handing future disaster scenarios, and for building the ongoing capacity and resilience our housing and homelessness system.