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The tight rental market means the number of people in rental stress increased substantially in the past 12 months.
At the same time, according to ME Bank’s Household Financial Comfort Report, mortgage stress reduced.
The report surveyed 1,500 Australian households and found 67% were in rental stress as their rent exceeded a third of their household disposable income.
Almost a fifth of renters were in extreme rental stress, putting more than 60% of their income towards rent. That level was 12% just 12 months ago.
The report says rents are rising faster than incomes and renters are struggling to keep up with that and other cost-of-living increases.
It found the number of owners dealing with mortgage stress dropped to 35%, compared with 37% a year ago.
ME consulting economist Jeff Oughton says that, on the surface, the financial comfort of the average Australian looks better than ever – but it is fragile.
“It has begun to fall for many households,” he says.
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