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The impact of discrimination in the private rental sector

A leading property manager has called on private landlords to undertake official training to prevent discrimination against tenants after a new study highlighted the issue in the informal real estate sector.

Hannah Gill, who is the director of The Property Collective, one half of Gill & Hooper and the REIACT president, made the call following the release of the Understanding Discrimination Effects in Private Rental Housing report.

Compiled by researchers from the University of Sydney on behalf of the Australian Housing and Urban Research Institute (AHURI), the report investigated the impact of informal tenancies on tenants from different minorities in Australia and how digital technologies established a pattern of discrimination, which thereby created a negative perception on the wider real estate industry.

University of Sydney lead researcher Dr Sophia Maalsen said the discriminatory actions seen in the private sector took various forms and were often subtle.

“For example, ethnic minorities may be required to provide more information when applying for a property including employment, relationship status and family size, or be given misinformation about available properties,” Dr Maalsen said.

Discrimination in the private rental sector has also been intensified by the growth of the informal housing sector, which includes many secondary dwellings (such as granny flats), improvised dwellings and some boarding houses.

The growth of the informal sector means more people are living with very limited security of tenure and other rights, and as a result this often translates into poorer-and often illegal-housing conditions.

Dr Maalsen explained informal tenancies are often advertised on under-regulated digital platforms that provide further opportunities for discrimination.

These websites has been reported to have biased screenings of tenants, specifying tenant characteristics about gender, race, age, and sexuality, that are not permissible in the formal rental sector.

Dr Maalsen noted previous studies have shown that professional real estate agents are less likely to discriminate than private landlords, but the wider real estate industry is often given a “bad wrap” due to these outliers.

Ms Gill said this “subtle” discrimination seen in the private sector may be also associated with landlords or private housing providers not having enough education.

“I can’t speak on behalf of every private agent but I think people generally don’t try to do the wrong thing,” she said.

“Just like people don’t try to be bad tenants, people don’t try to be bad investors.

“I think it’s primarily a lack of education for both parties [landlords and tenants]. When things go well, that’s great.

“But when there is a conflict or a friction point, neither party necessarily knows the right way to handle it and that’s when it gets really messy.”

Ms Gill noted that while professional real estate agents must undertake an initial registration or licensing course and then additional annual training, private landlords are not required to have any official educational background.

“I think there would be real merit in private landlords undertaking professional development just so they understand their rights and responsibilities as an investor to ensure they can do the right thing,” Ms Gill said.

Dr Maalsen also highlighted several critical policy areas that need immediate action, including increasing the supply of public housing to ensure vulnerable communities are not taken advantage of by the private sector and developing and enforcing specific minimal standards for all Australian rental accommodation providers.

While it may take time for these additional measures to be established, Ms Gill recommended professional real estate agents use their own platform to educate others.

“I would encourage people to share their knowledge through their social media, through website content and blogs, and through work you do in the community.

“Some agents hold information sessions to help educate.

“It can also be things like joining your local Real Estate Institute. It lifts that level of professionalism and generally will let you know if legislation does change. So members can be really proactive and on the front foot of any changes.”

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Jessamy Tredinnick

Jessamy Tredinnick was the news journalist for Elite Agent Magazine from June 2021 - October 2021. For current stories, news alerts or pitches, please email [email protected]