Mission Australia has called for a revamp of retirement payments, especially to older people who do not own their own home.
In a report titled Ageing and Homelessness: solutions to a growing problem, the organisation stated that older Australians who rented were more likely to become homeless as the Age Pension failed to keep up with their housing costs.
“Those who become homeless for the first time later in life are likely to have been private renters with a stable housing history who have experienced significant health problems, family problems, unaffordable rent, eviction or accessibility problems,” Mission Australia explained.
“A review of retirement incomes is required to ensure that older people can meet the cost of living. A particular focus is needed on social security payments for older people who do not own their own home and single older people, including the growing numbers of older women at risk of homelessness.”
Mission Australia Chief Executive Catherine Yeomans called for a commitment from governments to build 60,000 extra public housing dwellings specifically for older people.
“If funding was made available to build one new supported aged care facility in each state each year, that would have a meanful impact on addressing the current shortfall.”
In 1996, the shortfall of private and affordable rental dwellings for low-income households was estimated to be 150,000. By 2011, the shortfall had increased to 271,000, according to the Australian Housing and Urban Research Institute.
Anglicare research shows that just 1.62 per cent of available rental stock is “affordable and appropriate” for a single person on an Age Pension. For couples on an Age Pension, that rises to 4.28 per cent.
Mission Australia pointed to Australian Bureau of Statistics data that showed 14 per cent of people aged 65 to 84 years were renters and 11 per cent of those aged 85 and over lived in rented housing.
On social security payments, Mission Australia said a review should:
- consider the adequacy of payments for older people in the private rental market with a focus on Commonwealth Rental Assistance to prevent rental stress and reduce risks of homelessness;
- analyse payments for older people under the current pensionable age in the private rental market; and
- recognise the disadvantages experienced by older women and others who have had extensive periods out of the workforce.
Unless you want to move to Woop Woop, as a single retiree with few assets and no other form of income, your rental housing options are likely to be as rare as hen’s teeth. That’s because the Age Pension and Rental Assistance are not enough to cover the costs of living somewhere “appropriate”, under Mission Australia’s definition. There, it has been said.
In fact, here at YourLifeChoices we are hoarse from pointing out this bleedingly obvious truth, quarter after quarter, year in, year out. But that won’t stop us from doing it all over again next month with our December 2017 update of the Retirement Affordability Index.
Our own joint research with The Australia Institute published in the September 2017 Retirement Affordability Index revealed the cost of living for each of six retirement ‘tribes’.
The biggest group of Age Pensioners at 29 per cent were single homeowners who on average spent $450 a week on bare necessities. At 14 per cent of the retired population, single people who had to rent spent around $430 a week.
When you consider a full Age Pension is a mere $447 a week, you can see that there is going to be a very big shortfall. So, is it any wonder that a growing group of older Australians are joining the ranks of the homeless because they can’t afford to pay the rent?
Data from CoreLogic in 2016 suggested that apart from Western Australia, housing rentals in most other parts of the nation were broadly stagnant. And thank heavens for that, because they are already very unaffordable if your only income is the Age Pension.
The rental review showed median rents for units were $330 a week in NSW and Queensland; $250 in Victoria; $200 in South Australia; $320 in Western Australia; and $230 in Tasmania. It goes without saying that median rents for houses rather than flats were considerably higher. Data for the territories was not made available.
So just to recap: if you live in NSW and are paying roughly $330 a week in rent, the small change is around $117. Add rental assistance to this and you have just $268 left with which to buy food and medicines, pay for utilities and transport, and other basic costs of living.
These stark figures should no longer just be bandied around. They are a real reflection of how tough some people are doing it through no fault of their own. And, as Mission Australia explains, the Government must review upwards the social security payments made to renters now because many of them can no longer afford to have a roof over their heads.
How much is left over of your pension each week? Are you concerned you may end up homeless following an unexpected event?