Housing Affordability Crisis in Victoria:

YACVic welcomes the Parliamentary Inquiry into the Rental and Housing Affordability Crisis in Victoria conducted by the Victorian Parliament’s Legal and Social Issues Committee.

YACVic’s submission focuses on the unique barriers, challenges, and needs experienced by young people in Victoria’s rental system. It considers the inequities of the current system, examines the impacts of housing scarcity and unaffordability on young people’s access to housing, and the need for greater investment in youth-responsive social housing.

Our submission also considers the resultant homelessness experienced by young people in Victoria as a direct impact of the rental and housing affordability crisis. Young people are increasingly finding it difficult to access safe and secure housing, with deeply embedded systemic issues creating ongoing barriers. In this climate a Victorian Youth Homelessness Strategy is imperative, with a Youth Housing Guarantee, to reduce and prevent young people experiencing homelessness.

The national average length of rental tenancy is less than one year. Further, in Victoria, we have the highest national rates of month-to-month leases, with 22% of renters facing tenure insecurity.

The shortage of affordable, safe, and long-term rentals means young people are likely to move more often. We know short-term leases mean extra moving costs for renters, and mental health impacts due to the compounding stress of finding affordable housing in a highly competitive housing market. Frequent moving impacts life stability and can have flow-on effects on a young person’s access to education, employment, and family and community support.

While the factors leading to low availability and high costs of rental properties are widely established, the impacts of insecure and unsafe housing on young people’s mental health and futures must be considered and acted on immediately.

Regulation of leases and a reduction in the prevalence of short-term leases would have a direct positive impact on young people’s mental health and wellbeing, and support them in establishing stronger social connections to the communities around them.

In Victoria, the minimum standards for rentals were updated in 2021. However, there has been little enforcement of these standards since then towards private rental agents and/or landlords, and limited rights to empower renters if their current dwelling is not up to the standards.

Currently, tenants can make a complaint through a state regulatory body such as the Victorian Civil Administrative Tribunal (VCAT); however claims come at a cost of $67.40 to the applicant. Furthermore, in some areas such as bond dispute cases, VCAT can have a wait time of several months, which can cause serious financial stress for young people as they await a decision. Long wait times, financial barriers, and the power imbalance between landlords and tenants can ultimately deter young people from taking claims to VCAT.

In circumstances where property owners do not maintain their rentals to a liveable standard, the costs of running a home are passed onto the tenant, particularly in terms of energy consumption. Poor conditions can be harmful to tenants, including properties affected by mold, dampness, or broken electrical and gas appliances.

The lack of options in affordable housing means young people are forced to accept unsafe environments, poorly maintained properties, and significant rent increases, rather than risk facing backlash from their landlord and the possibility of lease non-renewal.

The burden should not be on young people to identify or deal with issues of poor housing standards or inappropriate rent increases; there needs to be greater resources and power for regulating bodies such as VCAT to monitor and enforce compliance with Victoria’s rent regulations.

Real estate agents were banned from rent bidding in Victoria in 2021; however, in 2021-22 Consumer Affairs Victoria issued warnings to 200 estate agents who were not complying with new regulations.

There are still no regulations about potential tenants making unsolicited offers higher than the rental amount advertised, so affordable housing becomes even more inaccessible to young people as they may be outbid by someone with greater financial resources.