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Young Australians left with just $13 a day as rents soar

The rental crisis has hit students and young Australians hard, with new data showing they are being forced to live on a “ridiculous” $13 a day.

According to Homelessness Australia, the record increase in rents has pushed many younger Australians into extreme financial stress and they are now forced to pay 73 per cent of their income on rent, up from 64 per cent two years ago.

The two-year longitudinal analysis cross-referenced the cost of 50 per cent rent of a two-bedroom apartment against the maximum income support payment available to a young person living away from home. 

Current rates of youth allowance are $338.2 per week, while the average cost of renting half a two-bedroom apartment was $245.50 per week – leaving just $92.7 per week to live on.

While overall incomes support payments increased 10 per cent in two years (due to CPI indexing), rents surged an “eye-watering” 24 per cent.

Homelessness Australia Chief Executive Officer Kate Colvin said most young people didn’t have enough money to survive in the current environment.

“After paying rent a young person on income support in Australia has only $13 a day to cover food, transport, medicine, power, and other costs,” Ms Colvin said.

“Unless there’s some magic pudding we’re not aware of, this is a ridiculous expectation.”

She said it was also extremely difficult for students and those on youth allowance to secure a rental in the current market.

“The reality is landlords will not rent to a young person whose budget is stretched this thinly, making it almost impossible for young people who can’t live safely at home to find somewhere to live,” Ms Colvin said.

Source: Homelessness Australia

Ms Colvin said the Federal Government needed to do more to help younger Australians.

“We urgently need to lift Youth Allowance and Commonwealth Rent Assistance so young people have the income they need to avoid homelessness,” she said.

“By failing to act, we are condemning growing numbers of young people to homelessness and poverty. 

“It’s impossible to develop skills and experience or attain an education when you’re hungry or unsure of where you will sleep.”

The latest figures from the Australian Institute of Health and Welfare show that each year 39,300 children and young people aged 15-24 come to homelessness services alone. 

Many cannot be safely reunited with family and need long-term housing and support.

“It is harder and harder for homelessness services to find young people a rental home and when they do, the rent is eye-wateringly expensive,” Ms Colvin said.

“If we want to give the next generation a genuine shot in life, the least we can do is give them the income they need to survive.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.