Dr Alan Morris from the University of NSW has been looking into the housing policy impacts on older people who are dependent on the age pension and who live in unsubsidised, private rental accommodation. In an ongoing study, Dr Morris has been interviewing Sydney seniors in the private rental market as well as examining public housing policy shifts since 1984.
Despite State and federal Government commitments to improve accessibility of older persons to public housing there is clearly a very substantial lag between demand and supply. As a result many older non-homeowners in Sydney are forced to depend on the private rental market and a large proportion are spending at least half of their income on rent. The big question is whether affordable and community housing will be built so as to fill the gap and provide much needed housing options for our seniors on low or fixed incomes.
The following is an excerpt from Dr Morris’s paper to the 2009 Housing Researchers Conference:
Implications of the Policy Shifts
The implication of the policy changes outlined is that public housing has become an exceedingly scarce resource which is very difficult for most people to access. Public housing authorities were instructed to prioritise applicants with complex needs (Heintjes, 2006, AHURI Research and Policy Bulletin 71). Thus, in New South Wales, an older people dependent on the age pension ‘may be approved for housing assistance as an elderly client’ only when they turn eighty and if they are Indigenous Australians, when they turn 55 (New South Wales Government 2006). The end result is that increasingly older people who do not own their own home are forced to depend on the relatively expensive private rental market for extended periods or interminably. There is simply no alternative. The critical point is that the cost of adequate private rental accommodation, especially in the metropolitan areas, means that these older private renters often have to devote a considerable part of their income to paying the rent. The Commonwealth Rent Assistance is of some help but is not nearly enough to make the rents affordable.
Older Private Renters in Sydney and Hardship
The [17 in-depth] interviews indicated that for many of the interviewees everyday life was very difficult. This was primarily due to their rent accounting for a large part of their income; their resultant lack of financial resources and the knowledge that once their lease expired they could be forced to move with little notice. Everyday life was especially difficult for those informants who had minimal or no family connections.
Financial stress and its implications
Interviewees’ degree of financial stress was determined by three factors – their overall income; the rent they were paying and the strength of their family connections. In Sydney eight of the interviewees were paying $200 or more a week, four were paying between $160 and $180, two were paying $150, two were paying $140 and the one interviewee resident in a boarding house was paying $110 a week. For all of the 17 interviewees their income was constituted primarily by the government age pension and Commonwealth Rent Assistance (CRA). At least three of the informants augmented their income with interest on savings. Extra income was also obtained through activities like baby-sitting and distributing brochures.
Interviewees described how hard everyday living was. Helen (all the names used are pseudonyms), who was paying $170 a week for her apartment, had about $5 a day for food. Her lack of financial resources meant that she was virtually house-bound:
“When you sort of add it up you say you get, I think the pension now comes to about $570 [a fortnight] or something with your rental allowance. But when you’ve got car insurance and … I’ve got a funeral plan, and I’ve paid all them since I was working, and I thought now why should I give them up when I’ve paid so much into them, so I still keep it going. You do get by. You just don’t do anything. You just struggle.”
Some of the interviewees were battling to sustain themselves adequately:
“They’re [the government] squeezing us. They’re absolutely squeezing us. I have never felt this squeeze like this. So desperate. Yes, there have been times where, a couple of weeks ago, I had eggs for three days and I bought Cup-A-Soups” (Beth).
There was consensus that the pension and CRA in the context of a tight rental market was far too low. Carol summed up this sentiment: ‘Well I honestly, well you know, the way the price of things … are today. I really don’t know how the government can expect, you know, a person to live on it’ [the age pension].
The Health Implications
For several of the interviewees a more significant health risk than not being able to afford a balanced diet or private dental care (all of the interviewees said that they could not possibly afford the latter), was the intense stress and anxiety their situation generated. Their financial circumstances and the insecurity around their tenure resulted in persistent stress. They were constantly concerned about how were they going to manage financially, the perception that there was no way out of their dire situation and the possibility of a rent increase which may force them to move.
Conclusion
The decline in the public housing stock and the resultant policy to reserve this scarce resource for people with complex needs has meant that older non-homeowners in Sydney and elsewhere are being forced to rely on the private rental market. The data indicate that it is exceptionally difficult for older people who are dependent on the private rental market in Sydney to access affordable and adequate accommodation. This is especially so if they are living by themselves and dependent solely on the age pension and CRA. The income received from the age pension and the CRA is simply not enough.
The interviews suggest that for older private renters in Sydney, severe financial stress, related health concerns, social isolation and, drawing on Amartya Sen, a lack of capability to lead a life they value, are common (Sen, 1999). Contingency played an important role. Some of the older private renters interviewed had had the good fortune to find sympathetic landlords and relatively cheap but acceptable accommodation and their lives were certainly easier as a result. Others had supportive families. The situation of most of the interviewees, however, was dire and it was evident that the high rents in the Sydney area meant that the income they received from the age pension and CRA was usually not adequate. Most were battling to purchase basic necessities and any unexpected expense was an enormous blow.
It is encouraging that in the latest budget there has been a renewed commitment to public housing. However, the envisaged 20,000 new public housing dwellings represents only about 11 per cent of the current waiting list and, at this stage, there is little provision specifically for older people. What is disappointing is that there has been no indication that the policy around CRA is to be reviewed. CRA will continue to be uniform nationally despite the massive variations in the rental market.
The data indicate that it is imperative that housing policy is recast so that older non-homeowners either have enough income to afford to live in private rental accommodation or that housing availability in the public or community housing sector is expanded so that an older non-homeowner is able to access this housing tenure if they so desire. At the moment one in eight Australians are 65 and over; by 2050 one in four will be 65 and over. Present trends suggest that unless there is recognition of the situation of older private renters and a program to increase the supply of affordable housing for this grouping, or alternatively substantially increase the age pension and CRA received, there is likely to be a substantial increase in the number of older Australians living in serious poverty with anxiety and stress as their constant companions.
Dr Alan Morris’s research continues with older people who are dependent on the age pension and who live in unsubsidised, private rental accommodation. To be part of this significant and confidential research please contact Dr Morris on 93853541 or 0425357023, interviewees will be reimbursed travel expenses and receive $30.00 for their time.