Two years ago we had a housing glut in our major cities. There was a boom of new apartment building. Many tenants signed leases in the inner cities and networked, planned their lives and lived, as you do.

Who would ever think that in such a short period of time, an extreme glut would flip into the worst rent crisis in 20 years. In a short period of time, so many are forced to leave the same properties.

In 12 months, rents have gone up by $50, to sometimes $80 per week. It is usual for a decent 2 bedroom flat in the inner city to be from $400 to $900 per week. This is a huge jump from just 2 years ago.

We have tenants rights tribunals and regulations as to how far landlords can raise rents in a short period of time. There are so many loopholes in the rental system and tenants rights, that the regulations are being all but ignored.

Sad to see nurses teachers and good people forced to leave the area replaced by up-market cocaine dealers, business sharks, and others that are very good at making money. They also don't tend to be responsible enough to take out a loan to buy and I wonder how they are trusted on a lease. They are good at fudging references and faking their legitimate incomes. Who cares if they pay such high rents?

So ethics have very little do with security of tenure. The lawless and sleaze, who these days, are valued more than essential services are taking our houses. What ever happened to regulation and decency?

The whole reason for living in the inner city is leaving town. You will be left will high crime, as they earn good money now (I know the statistics), business sleaze sharks and others who take more interest in Zurich than they do in the Sydney villages.

That's what happens with high immigration.

Move to the country. A two bedroom flat will cost you perhaps $150-$200/week. You can take a reasonable drop in income when you are saving that much in payments. If more people start to leave Sydney etc, then the government might also get serious about spending up on regional infrastructure. More people means more jobs created. Crime rates are lower (in most places), you can get to work within 15 minutes (at the outside) and the air is fresher. head out west and leave the landlords to their substandard tenants.

Simply going on the content of this post, it looks like the law of supply and demand is working normally here.

We had a glut. Now we don't.

>>...the worst rent crisis in 20 years<<

What happened 20 years ago? It would appear that the "crisis" eventually turned into a "glut".

Now that "glut" is becoming a "crisis" again.

Can we detect a pattern emerging here?

Convenience has a price, we pay extra for the convenience of inner-city living. We also pay extra to live somewhere that a lot of other people want to live.

The only concern here should be the ability of essential service personnel such as nurses, firemen, teachers etc. to live within reasonable distance of their work.

(And if you think Sydney has a problem with this, try being a nurse in a central London hospital like Guys or Barts...)

It should not be beyond the wit of man to devise a form of inner-city rental subsidy for these people.

Misattributing Sydney rental crisis to lawless, sleazy business sharks and drug dealers hardly does much for good debate.

Large quantities of money & debt flowed into the rental market from: the baby boomers utilising Govt provided tax offset, tax haven and first home owner mechanisms; increasing numbers of speculative investors; a good deal of foreign investment (but getting statistics is difficult).

Luxury development is conspicuous. Inconspicuous is the lack of new moderately priced accommodation - for that you have to head out along the rail corridors - it has been sluggish.

Place this in the context of population growth and Guest Worker programs - sub-section 457 temporary worker visas. There is no cap.

"In the December half, 457s were running at an annualised rate of 45,000, but with the extra drive and need for workers, plus the dependants’ temporary visas, it’s not hard to speculate that guest worker visas of one sort of another will hit six figures and keep going. That means a real immigration numbers approaching 300,000 next financial year."

The Government has failed to skill Australians in trades and professions.
http://www.workpermit.com/australia/skilled_demand_list.htm

It is cheaper to import and it keeps a lid on wages.

The Australian Department of Immigration and Citizenship (DoIC) has 25 Officers working for business to pull in skilled and semi unskilled workers on temporary 'rolling' work visas or for permanent immigration.

In the next financial year some 300,000 immigrants both through skilled immigration, family, and humanitarian (small) programs will come to Australia.
In 2005 - 2006 some 45,000 immigrants settled in NSW - most would be in Sydney. On top of this add Student Visas, Guest Workers.

see Canberra quietly ups the skilled migration ante – it’s all about inflation
http://www.crikey.com.au/Business/20070504-Canberra-quietly-ups-the-skilled-migration-ante-its-all-about-inflation-.html

Uh, Deus.... I would have thought that large quanities of money pouring into the rental market from the likes of speculative investors would be a good thing - more investors = more rental availability = no crisis.

Pericles, I agree. There needs to be some form of subsidy available for emergency services workers, that doesnt have a tax impact (currently they would run smack into an FBT problem). I consider this to be a good use of taxpayer funds. As for anyone else, I stick to my suggestion of leaving the city. Come out to the country where businesses are crying out for skilled workers. Yes you need to take a little paycut, but consider how cheap it is to find housing and you'll probably have more in your pocket anyway.

Country Gal,

I'll clarify. Speculative 'investors' not building/housing developers or long term landlords. Speculative investors purchasing existing stock waiting for price increase and selling in short time frame to achieve a capital gain, secondary is negative gearing but rack up as much rent as fast as you can. Trading in existing housing stock as business - works while the bubble expands, works while there are supply constraints e.g., no large land releases, no significant changes to bid rent values, works when populations increases faster than new stock, works while major services and businesses don't relocate towards the fringe, works while transport doesn't allow easy mass transit, works while cost of private transport is high, works when cost of building is high.

40 kilometers from the same coastal resort a third of city folk flock to at Christmas .
A home that is valued at $200.000 no more, can be rented for $180 a week.
Top rent is $280 but those homes are no better all have tank water and septics.
You can pick from ,truly about 50, to 80 homes in 5 towns or villages but will work for far less if you do go bush.
20 years ago those homes rented for $30 and sold for $40.000.
One day a sea change will take place and Sydney prices may drop but truth is our city's are growing too fast too big and money rules this country.

Saint Fletcher,
The answer is in your own post. "We have tenants rights tribunals and regulations as to how far landlords can raise rents" " What ever happened to regulation... "
Obviously the more controls you have in the rental industry the less possibility there is to make a buck.
The problem is solved when more property developers get into the game. Supply and demand and all that.

Also: this concept of public housing is rather dumb. Poorer people are given two and sometimes three bedroom houses/flats in very often prime areas. Even though they pay about $100 p.w. whatever, the actual market price is probably two to three times that. Why not just give them $100 p.w. to help them find accomodation and then hire out their accomodation at the market price. The govt. would not lose out financially and as public housing tennants are generally not working anyway it wouldn't matter to them where they lived. Actually if all welfare/dole reciprients were given the same amount immaterial of where they lived then there would be the inducement to move out into the country where rents are cheaper, thus leading to the pressure being taken off city accomodation.

There is a reason why the most expensive area in Sydney also has some of the highest levels of people on disability support pensions. They have to live close to the major hospitals. The other hospitals simply don't have the recourses or the doctors to deal with complicated cases.

This is why they live in areas such as Wooloomolloo, Surry Hills and even Redfern. As such, they are also the most difficult housing stocks to find emergency cases to house the waiting list. Some waiting lists are up to 10 years long. We have patients with terminal illnesses living in hostels, and no where to plug in their oxygen apparatus. They often have uncontrolable bowels and vomiting, and can't climb steps.

You can't send them to the country, the hospitals there can't cope with them. Many are from the country. So there are poor people trapped in a wealthy area.

There are various rental subsidy schemes by the NSW Department of Housing but the "benchmarks", that is, the amount subsidised in relation to the total rent cannot keep up with the rent increase. Hospitals used to have patients, expecially old people, in hospital, to heal. Now they send them to emergency housing: Department of Housing.

Then there are the tenants from the Richmond Report, those that use to be in psych. hospitals are dumped into Department of Housing. They are neglected, cause trouble which is not their fault, they are insane officially and wards of the state. They also need specialist care, they have complicated issues.

So which ever way you look, the situation is going literally insane. I don't see market forces, I see people, and you can't just expect them to move. They live in the inner city for necessity, not because it's a nice post code.

Good point saintfletcher. That's where government needs to step in with a development proposal for a major regional centre. Develop a regional hospital with the required facilities - people dont have the same rental issues as they do in inner Sydney, and the development would do wonders for the economy of a regional centre. Win-win. Now, to find a government with the necessary foresight......

An Australian government with foresight - an oxymoron if I ever saw one!

I would like nothing more than move back to the country, country gal. I hope that your vision will come true one day.

There is nothing more than I miss than waking up in the morning at Pambula Beach to the king parrots splashing in the pond, the black cockatoos kiting over my balcony, and kangaroos in the neighbourhood that I knew by name, and the a beach view unthinkable in the city. The rent for this 3 bedroom brick house was 1/4 of the dump that I now live in. The kids miss the country, I know. I struggle to pay the rent in the city but for my own reasons, I'm stuck here.

The question is, are country people ready for us wierdos from the city with all our quirks, strange ideas together with our skills and free spirit? I guess this is not fair on country people. But if skilled city people who usually like diversity did really move to the country on mass, would there be harmony or would there be cultural rivalry?

Australia needs to a population decentralisation strategy. Senator Lyn Alison last year published an OLO article advocating decentralisation, entitled "Small town life-styles". As much as I dislike the useless Democrats, Senator Alison made some very good points.

Read it here:

http://www.onlineopinion.com.au/view.asp?article=4920

Mark Latham also advocated a decentralisation policy of sorts. He argued that new migrants should be encouraged to settle in regional areas, as opposed to cramming into the already overcrowded capital cities.

Read his views here:

http://www.smh.com.au/articles/2004/04/20/1082395857017.html

The Howard Government's immigration program is fundamentally flawed. It is purportedly aimed at alleviating Australia's alleged "skills shortage". However, the skills shortages are mainly concentrated in regional mining areas e.g. high-growth regions and towns in Western Australia and Queensland. There is no mining boom in Sydney or Melbourne.