Federal Inquiry hears from Tenants' Union: Three times as many renters calling now for advice on rent increases

Yesterday, the Tenants' Union of NSW, along with colleagues from Shelter NSW, the Public Interest Advocacy Centre, Legal Aid NSW, Economic Justice Australia, Foodbank and the AntiPoverty Centre, appeared at the Sydney hearings for the Federal Inquiry into the Worsening Rental Crisis in Australia. Renters from across NSW also shared their experiences directly with the Inquiry (and see this report from the hearings in Queensland earlier in the week).

The Tenants' Union told the hearing the current crisis is particularly acute, but not new. Over the last 12- 18 months we have seen a significant increase in the number of renters calling their local Tenants' Advice and Advocacy Services for advice—three times more calling about rent increases than before Covid, twice as many calling about 'no grounds' evictions than before Covid. Our key message: more needs to be done to address the lack of availability, but also and importantly the problem of inadequate regulation.

Written submissions (including from renters and community members) are welcomed, due by 1 September. Or you can provide feedback through the Inquiry's survey form.

Below we publish the opening statement of Leo Patterson Ross, CEO, Tenants' Union of NSW from yesterday's hearing.

 Thanks so much to the committee for the opportunity to present today. I would first like to acknowledge that I am talking to you from the lands of the Gadigal of the Eora nation, always was and always will be. It is particularly relevant to acknowledge because Aboriginal people are predominantly renters and particularly in this area, and that is a result of historic injustice around land and housing and our treatment of it.

The Tenants Union of New South Wales is a specialist community legal centre, resource service for a network, a statewide network of Tenant Advice and Advocacy Services and the peak body representing the interests of tenants in New South Wales. Established in 1976, our expertise, experience and connection with renters places us in a position to comment on these issues and observe and highlight the effects of policies.

When addressing the crisis we need to start by acknowledging the policy foundations of our renting sector and ensure that the sector is fit for purpose. Primarily, we need to recognise that the purpose is to provide housing—homes—for people. With other essential services such as healthcare, energy, food and water, we ensure that the systems set up to deliver services hold that primary purpose in mind. Even in privatised or market-driven essential services there is a consensus across government, across industry and across the community about the primary purpose of the sector. Investment is made with that goal in mind, and with an acceptance of regulation that is in aid of ensuring the purpose is met. That's primarily what we've been missing in the renting sector. We can better discuss and disagree on particular settings if we maintain that consensus, and look to it as a guiding principle.

Having agreed on the primary purpose, many of the current debates and their solutions become much more clear and less fractious. We need people who are investing into the renting sector to do so on the basis of that purpose and recognise that there are needs within that sector that have to be met. The question then becomes how best we meet them. We also need to better frame the investment expectations to align with the needs of the sector—so a long-term, stable investment with modest reward, rather than the more speculative chase of capital gain and taking on very large risks with highly leveraged investment strategies.

At the moment, from the Federal Government's responsibilities of banking and taxation policy to state-level regulation and planning and the shared responsibilities of funding the social housing and homelessness sector, we don't really see that recognition that there is an essential service that is not currently delivering for the community. The system is much more individualised. That means that when the system breaks down and experiences market failure, as we're seeing now, there are fewer mechanisms to respond to that.

We're seeing at the moment a particularly acute crisis, but we need to recognise this has been the case for several years. In Sydney the movement of rents and wages diverged following the financial crisis and hasn't recovered since—and that's not to say that everything was peachy in 2006. 

People particularly on lower incomes have not been well served by the private renting sector for a long time. The Whitlam poverty inquiry identified this and a number of areas to address, including no-grounds evictions and minimum standards. Nearly 50 years later, these issues are not resolved. It took until 1 April 2023 for any jurisdiction in Australia to end no-grounds evictions. We have widespread repairs and maintenance concerns that aren't attended to, and we have displacement of people from their communities and their connections to family, friends and social and economic supports and opportunities.

We have a system that is very individualised. People are meant to try and enforce the contracts and rules as they are the primary actor, and those contracts are somewhat standardised. For instance, if a property is not in a good state of repair it is the tenant who is the actor in enforcing repair rights. Their rights don't start until the tenancy begins and they end when the tenancy ends. Quite often we hear from people who want to make sure the next tenant doesn't face the same issues they have and is moving into a place where the repair issues are well known, but there is no mechanism to prevent that — and that's a source of great frustration for people. It also means the knowledge and experience of former consumers of a particular service aren't able to translate into better outcomes for the next person. This is very different to other essential services like food or health care, where there are a range of standards checked prior to the customer, consumer or client ever walking through the door. Individual complaints can be heard and attended to but they are not the sole and primary actor that has to take that heavy load.

We have to develop a strategy to address this crisis that works across the creation and ongoing experience of homes, to ensure that homes of good quality are available in good locations and that these homes are safe, stable and affordable places for people to live. We have to acknowledge that relying on market forces alone is insufficient; if they were sufficient, we could simply build and market dynamics would deliver on everything else. We can also acknowledge that regulations can't overcome the pressures of a lack of availability. The two levers have to work together across all aspects of delivery of homes for people who rent.

In the lead-up to this inquiry, our colleagues in the National Association of Renters Organisation and more than 80 collegiate organisations published a statement around the particular priority areas. That identified the need for greater stability and security for people who rent their homes; stronger protections and fair limits on rent and rent increases; safe and healthy homes for renters, including minimum standards particularly around energy efficiency and accessibility; better enforcement, oversight and accountability around the system of renting; access to free advice, assistance and advocacy services; and substantial investment in social housing, aiming for 10 per cent of all dwellings by 2036. 

The National Association of Renters Organisation has also further developed priorities within the following report, The National Nine:Principles for Strengthening Renters’ Rights. The full report will be provided to the inquiry before 1 September. 

In addition to key considerations such as ensuring security, affordability, and liveability of the homes renters live in, the priority reform areas include:

• the management and security of tenants' money as represented by their bonds and security deposits;
• the protection of private information and discrimination, particularly in the application process;
• the universality of protection for all people renting their homes; and
• the need to use data to inform policy. 

Thank you again for the opportunity to appear today and speak to you about this very important issue. I'm happy to take questions on any of those topics and any others you'd like to ask about.