Why renters have it tough

Ned Cutcher, senior policy officer, Tenants’ Union of NSW

Australian dreams of home ownership are starting to fade, particularly in our major economic centres. What would it take to make renting fair?

Renters can’t enjoy relationships with property like homeowners do, because the default setting for Australian tenancies is “insecure”. Agreements are offered on initial fixed terms of six or 12 months, before continuing week to week. They can then be brought to an end without a reason, so renters never really know how long they can stay in their current home.

In parts of Europe anything less than a three-year agreement is considered “short term”. Tenancies in Germany, the Netherlands and Sweden are indefinite and cannot end without legal grounds.

As we look to these countries for inspiration, we observe a shared aspect: our tenancy agreements are also indefinite – it’s just that ours can be brought to an end without a reason while theirs cannot. This could be fixed with a modest change to Australia’s renting laws. Victoria has recently proposed leases of more than five years, among other reforms.

The difference exists because the majority of Australians have lived most of their lives in homes we own rather than rent. Renting is expected to be short term, good enough while we study, establish careers and save to buy. As European economies focus less on home ownership, their renting laws place greater emphasis on security of tenure.

With conditions changing across Australia, our focus will have to change here too. We’ll need to stop thinking of property as moneymaking “bricks and mortar”, because housing will only ever be a cost for many. Some Australians will rent well into their adult lives, if not for life, raising families in homes they cannot afford to buy. But whoever owns it, Australians should always be able to make a home out of the house they’re in.