General News
14 July, 2022
Rental shortage, rate rise cause local housing issues, but not all is “doom and gloom”, agents say
A local resident has labelled the five-month process of trying to find a rental property as a “nightmare” as the local market shortage continues amidst cost of living pressures and rising interest rates. Maryborough and the broader Central...
A local resident has labelled the five-month process of trying to find a rental property as a “nightmare” as the local market shortage continues amidst cost of living pressures and rising interest rates.
Maryborough and the broader Central Goldfields Shire has struggled with rental shortages for a number of years now, an issue exacerbated by the COVID-19 pandemic which has highlighted the housing shortage currently gripping the district.
Since 2017, the median price of houses in and around Maryborough has skyrocketed by 84 percent, rising from $198,000 to sit at around $365,000 according to the Real Estate Institute of Victoria.
Largely driven by an exodus of people from metropolitan areas moving to the regions, the availability of local rental properties, which had already struggled, has been put under further strain.
According to realestate.com.au, around 80 houses are currently for sale in Maryborough and surrounds but by contrast, there were just seven rentals available as of Thursday afternoon with an average rental price of $260 per week for a two bedroom unit and $320 a week for a three bedroom house.
The highly competitive rental market is taking a toll on a number of residents, including Laurelle Mann who despite countless applications, has been knocked back time and time again.
“The whole process has been a nightmare, I’ve been trying to find a rental since February and it’s so frustrating, it messes with you mentally,” she said.
“All I want is a home, somewhere I can go when I finish work and relax but you can’t even get a look in at the moment.
“I’ve lived and rented here for 25 years, I recently left to work on a cattle station and I’ve come back to work here and just can’t get a place to live.”
Despite both Ms Mann and her partner working full time and having positive references, the couple say they have been unable to secure a rental because of how competitive the market currently is.
“To even apply for a house you have to go to an inspection which are held one day a week and you can guarantee there will be 40 to 50 people there,” she said.
“Working full time has actually made it harder to get a rental I think because I can’t make it to the inspection days.
“I have actually said to agents that I would take any property without the inspection, you see photos of the house online so it’s not like you’re going in blind, I just need somewhere to live.
“At one point I was actually looking at living in my car, I had nowhere to go.
“I’ve tried private rentals, I’ve got a sign up where I work — I’ve tried everything.”
Professionals Maryborough director Coby Perry said the high demand for rentals and lack of housing availability has caused the lowest vacancy rate he’s seen.
“We’re still experiencing a very low vacancy rate and very high demand for sure,” he said.
“It’s basically the lowest vacancy rate across the board that I’ve experienced and for our agency, we have no rentals available and if we do, renters line up for them and they’re gone very quickly which is tough, it makes it hard for renters to secure a property.”
Recently released 2021 Census data revealed 37 percent of those renting in the shire were experiencing rent stress (where rent payments are greater than 30 percent of the household’s income), compared to 11.7 percent of those with mortgage repayments.
According to the census, the median household income is $904 per week and if factoring in the average rental cost of a three bedroom house, would leave $584 for the household to spend on groceries, bills and other expenses.
Similarly, the median weekly income for individuals in the shire is $503 and with the cheapest rental property on the market costing $285 per week, individuals would be left with just $218 in their back pocket.
Mr Perry said the rising cost of living was putting pressure on residents looking to rent and buy properties.
“There is a lack of housing in the area for the current demand and the cost of living across the board is certainly weighing in as well,” he said.
“Maryborough has and is continuing to experience significant growth like a lot of regional areas which is great, however we need the housing availability to sustain that growth.
“With the current state of play, affordability is certainly changing for buyers and renters — we’re seeing a couple of people lowering their pre-approved budgets from say $400,000 down to $380,000 which could be a reflection of rising interest rates as well.”
The Reserve Bank of Australia recently lifted interest rates by 0.5 percent to 1.35 percent, the third time it has increased in the past three months.
Maryborough Ballarat Real Estate’s Kate Ashton agreed that rentals were tight and said rising interest rates could squeeze the rental market further.
“We are seeing a real lack of rentals, there are very few properties available — you look on social media or bump into people all the time who are desperate for a rental house,” she said.
“Unfortunately increased interest rates will mean some people won’t be able to afford a house at the moment and for people who are currently renting that may mean they have to rent for longer which could put more strain on rental vacancies.
“With all the recent changes in rent rules there is also caution in regards to having an investment property as well which doesn’t help.”
First National Real Estate principal Craig Bell said it wasn’t all “doom and gloom” for the local market, which he said continues to grow in strength for property owners.
“Things like rising interest rates may have an impact on the local market, for example there’s certainly not the urgency there was in the market six to 10 months ago, but our market is still very strong and our median house price continues to creep up,” he said.
“There is a lot of talk of prices dropping but from our point of view, things are still very good for us here — it’s not all doom and gloom, property prices are very much holding their own and we’re seeing no indication of prices dropping.
“Certainly interest rates affect everyone, but in the market here your mortgage will be a lot less than it is to somewhere in Melbourne for example, it doesn’t have the same affect.”
