Last month, the Victorian Labor state government passed the Residential Tenancies Amendment Bill. An advertising blitz on social media declared it was the “biggest reform to renting in Victorian history” and that it would “make renting fair”.
But far from making any significant changes, the bill barely touches on the main issues that renters face. Worse still the minor reforms will not even come into effect until 2020!
Highlighting just how modest the changes are, the New South Wales Liberal state government has also introduced similar legislation.
Under the Victorian laws, tenants will now be allowed to keep pets and make minor modifications to a property, such as nailing a picture hook in the wall.
Rental properties will need to meet basic safety and maintenance requirements, with functioning stoves, heating and deadlocks. People fleeing family violence will be able to break leases without incurring penalties and no-grounds evictions will be banned.
These are rudimentary standards that should have already been in place. They have existed for years in most other OECD countries. The fact that these changes are only being introduced now is an indication of the power that landlords and big business have over the major parties.
While these modest reforms are welcome, there is a glaring lack of real measures to address the crisis of affordability in the rental market. For the majority of tenants, the enormous financial burden of renting is by far the most pressing issue.
Around 35% of renters in Australia are now experiencing housing stress, paying more than 30% of their income in rent.
While the new laws limit rent increases to once a year and cap bonds at four weeks’ rent, there are still no restrictions on the amount of rent that landlords can charge. When the base price of rent itself remains completely unregulated, the other changes pale into insignificance.
Underscoring the depth of the crisis facing renters, new data released in August from social housing provider Compass Housing shows that renting is no longer unaffordable just for low income earners, but now widely affects average income earners as well.
The Affordable Housing Income Gap report found that an average household would need to earn an additional $268 per week in Melbourne and $519 per week in Sydney to afford rent in a two-bedroom unit in the inner suburbs.
In describing its findings, the report is blunt: “In 2018, a typical renting household seeking to avoid housing stress in Sydney, Melbourne or Brisbane must choose between living a considerable distance from the city, or living in a one-bedroom apartment. If neither option is practical, households are effectively forced to accept living in housing stress.”
This extreme situation is a consequence of the logic of the capitalist market, a system that puts profits before the need of people to have a roof over their head. The Liberals and Labor have both facilitated this state of affairs by providing tax breaks to speculators and privatising public housing stock.
With state elections looming in Victoria and New South Wales, and trust in the major parties at an historic low, governments want to be seen as doing something for renters. That is what these changes are about.
The mostly cosmetic reforms will not hinder landlords, developers or housing speculators from profiting at the expense of ordinary people. In that sense these laws and the entire set up are far from ‘fair’.
Genuine reform to deal with housing stress requires taking on these vested interests and implementing a bold strategy to take the profit motive out of housing.
Socialists call for rent control to be imposed as an urgent measure to ease the situation facing millions of struggling tenants. Rent control should be linked to tenants’ earnings and capped at 20% of income as a basic standard for affordability.
Other rights for renters, such as long-term leases at the tenants request and tighter laws to ensure the quality of rental properties beyond the bare essentials, are also needed.
This should be combined with a program to build or acquire 500,000 high-quality public homes Australia-wide. This would eliminate the public housing waiting list while creating tens of thousands of jobs.
An expanded public housing network would give low and middle-income earners an alternative to the private rental market.
These types of policies would work best as a component of a socialist planned economy that saw housing and other essential needs as a basic right. We say picture hooks are not enough! We need rent control and real solutions to the housing crisis now!
To get involved in the fight for decent, secure and affordable housing contact Renters Fightback.
By Jeremy Trott
