Exclusive: A Melbourne woman who was repeatedly rejected for leases says she is “baffled” after qualifying for a mortgage first, exposing the crisis facing renters in one of Australia’s friendliest property markets.
Shannen Egan spent weeks searching for a one-bedroom property to rent in the city’s north and has faced seven back-to-back rejections with no explanation.
Melbourne is often named Australia’s most liveable city. But renters are facing a nightmare. Getty Images
Do you have a story? Contact reporter April Glover at april.glover@nine.com.au
Seeking pre-approval for a home loan, however, was far simpler.
“I’ve been to about 12 to 15 inspections in six weeks, I applied for around seven and I got knocked back by them all,” Egan said.
“I cannot believe that I’ve just been pre-approved for a mortgage before I got approved on a lease, that’s mental to me.”
Egan said she hadn’t intended to buy a property, adding that she wasn’t quite ready to part with her life savings.
The dire rental outlook had seemingly forced her hand.
“I feel like I’m being forced into something that I don’t want to do, just so that I have a roof over my head for the foreseeable future,” Egan said.
“It’s been a nightmare.”
The British-born business owner was about to give up when she was eventually approved for a last-minute lease transfer this week.
The situation is similar for many of her friends and co-workers.
“Melbourne is one of the most creative places in the Southern Hemisphere, and people in those sorts of industries and hospitality are being either forced to move out of Melbourne, move overseas, or just stay in share houses into their 40s,” Egan added.
A line of prospective tenants waiting for a showing in Brunswick, Melbourne. Reddit
The weekly mortgage for a one-bedroom apartment in the same areas is not dissimilar to the advertised rents Egan was seeing.
The average weekly rent in Melbourne is now at a record high of $694 per week, an increase of 6.7 per cent in the past 12 months, according to data from PropertyMe.
Melbourne is affordable compared to its capital city counterparts Sydney, Perth and Brisbane.
But the problem is often getting approval to live in them.
The Victorian capital’s rental market remains tight with just a 1.6 per cent vacancy rate for June.
The average weekly rent in Melbourne is now at a record high of $694 per week. Dion Georgopoulos
Egan admits she was “shocked” by the prices being advertised for homes with peeling wallpaper and mould.
“I personally don’t think that some of them are even liveable,” she added.
Housing advocates say Melbourne renters could see the market shrink even further as investors panic and clearance rates continue to fall.
Coonan (pictured) said residents have been forced to couch-surf or move back home. Jay Coonan
Co-coordinator of the Antipoverty Centre Jay Coonan told nine.com.au that government policies need to focus on providing better long-term options for renters, not just prospective homeowners.
“The rental crisis is not going to solve itself as long as the government continues to rely on private landlords to fix this crisis,” Connan said.
“We’re never going to be able to return to a stage where private landlords provide housing because that should not be the role of the market.”
Coonan said Melbourne residents have resorted to moving back regionally to live with their parents or couch-surfing after being unable to find a rental.
“Older people who are seeking tenancies are just basically going homeless because they don’t have those social support networks,” he added.
“We just need an expansion of public housing to provide secure, safe tendencies for everyone who needs it.”
The Victorian government has announced a suite of stronger rights for renters, including banning rental bidding, extending notice periods for increases and notices to vacate and more power to stop excessive rent increases.
There is not enough being done, however, Coonan warns, to ensure these tenancies are even available in the first place.