Troubling figures show that young, low-income earners in Brisbane are entirely priced out of the rental market and pensioners are also spending too much to keep a roof over their heads.

Despite Domain Group data showing falling rents for units and stagnant rents for houses over the past year, the SGS Economics, and Planning report shows that reasonable housing costs remain out of reach for the city’s low-income earners.

SGS today released research showing what percentage of their income Brisbanites spend on rent, and, for several at-risk groups, the numbers are dire.

Brisbane’s affordability is worsening for low-income earners. Photo: Tammy Law

The research was done in conjunction with Community Sector Banking, and their head of relations, Jim Barron, said it was a compounding issue.

“Ten years ago it was a lot cheaper to rent in capital cities,” he said. “This index proves Aussies are often spending more than a third of their income on their rent and that’s impacting their ability to live a good life.”

Young renters on welfare need to spend 100 percent or more of their income to make rent and pensioners 44 percent. Even worse, if a pensioner moves houses, most new rental agreements can take up 67 percent of their income.

Most people only have enough savings to last 14 years beyond retirement, while Australian life expectancy creeps higher. Photo: Dominic Lorrimer

Ellen Witte, a partner at SGS, said it was clear the situation was untenable for most households. “Renting fails to provide a secure roof over the heads of students, pensioners and working families with children,” she said.

In Brisbane, an average family can expect to spend 24 percent of their income on rent, which is approaching the generally accepted stress threshold of 30 percent.

Dual-income families are in a much better position, with no part of the Brisbane rental market out of reach.

Rising unaffordability is tied to rising homelessness. Photo: Erin Jonasson

Renters on welfare were generally left with one option: joining a share house. However, that would not guarantee the ability to live comfortably, with suburbs becoming affordable for share houses only towards Ipswich, Logan and North Lakes.

“What we see as a result of that is [that] people rely on share housing, overcrowding in houses, [and] that results in situations that are not pleasant from a social context, and homelessness is on the rise,” Ms. Witte said. “We’re seeing it more with older single women who can’t accumulate enough superannuation.”

The overall affordability of Brisbane suburbs was up on the first quarter this year for average households, but the worsening situation for low-income earners was caused enough for concern as it can begin a slide into homelessness for some, Ms. Witte said.

“It’s quite horrible if you think about it,” she said.

The Sunshine Coast and the Gold Coast also faced deepening affordability issues because of relatively stagnant wages and rising prices that come with their growing reputations as lifestyle regions.

Mr. Barron said it was past time for a solution to the housing affordability crisis, as low-income earners continued to become more strapped for cash in an effort to pay for housing.

“This report reaffirms what we already know. The solutions are not easy and people have been moving towards them for years and we’re not there yet,” he said. “At the end of the day, this is a national problem deserving of a national solution.”

Mr. Barron expected most of the property market to be willing to work towards a solution.

“If you did a survey of most property developers, community housing providers, urban renewal agents, people working in this space for a long time, I don’t think you would find anyone unwilling to find more people to get into the house purchasing market,” he said.

Ms. Witten said renters needed to be included in the solution. “The rental market is now a third of the total households, so any response to solve the housing market includes a focus on the rental market,” she said. “One way is taking away the barriers to the build to rent sector; it would significantly increase the supply of rentals, so we aren’t just relying on mum and dad investors.

“There’s also a real need for governments to significantly invest in social housing.”

Governments need to act now, to prevent inequality widening in future, Ms. Witten said.

“In some cases, you see cities developing two faces,” she said. “One on the upside with houses with good incomes that can afford rents even if they are increasing, but for the lower-income households, they will continue to struggle and in some cases deteriorate.”