The “hellish” living hunger games for buyers and renters

Nine properties were auctioned in Preston on Saturday.

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“We’ve seen a lot more buyer activity in the market,” Dolcetta said. “The rate hike this week didn’t slow that down.”

Interest rates hit a 10-year high of 3.35 percent on Tuesday, making hefty home loan repayments increasingly unaffordable for many.

But some buyers, Dolcetta said, have already factored that in.

“I think most people are already preparing for it,” he said. “At the end of the day, people still have to scale up, scale down and transact.”

International student Anny Aranutayanun, meanwhile, has lost count of the number of properties she’s looked at in the last two months while looking for a place to rent.

According to best estimates, she submitted more than 30 applications – without success.

“This is the sixth today [inspection] and in every house there are a lot of people,” Aranutayanun said during an inspection for a two-bedroom apartment on Blanch Street advertised at $550 a week.

Rental vacancy rates in Melbourne are at a record low of 1 per cent and advertised rents have risen at an unprecedented pace.

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Tenants Victoria Director of Community Engagement Farah Faroque said tenants are under extreme pressure, particularly those on low incomes or surviving on income support.

“Contagion has spread to working people with moderate incomes and good rental histories, who have sometimes rented for decades, [and] are finding the competition quite intense and missing out,” she said.

Renters Victoria has worked with a family who have looked at 64 rental properties with no success.

It is also monitoring an increase in rent increases since the start of the fiscal year from a smaller increase of $30 per week to a $480 per week increase for a shared apartment.

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“The rental market in Melbourne is extremely challenging,” said Faroque.

“It’s more than hot, hot, hot, it’s even hellish for a lot of people.”

Brendan Coates, program director for economic policy at the Grattan Institute, said there is a race for space among Australians looking for a place to work from home or to move out of shared apartments or family homes, which is driving housing demand significantly.

The Reserve Bank of Australia estimates this trend has created demand for an additional 140,000 homes, offsetting the slowdown in population growth during the pandemic.

“The number of migrants is recovering incredibly quickly, but the existing Australian population kind of sprawled out on the park bench while nobody else was there,” Coates said.

“You’ve got it somehow hunger games Scenario where very few rental properties are available and many people want to rent them.”

The Grattan Institute estimates that the Chinese government’s decision to only recognize degrees earned locally could result in up to 40,000 additional students returning to Australia in the coming months.

This will likely result in an additional need of 20,000 homes – more than a third of the total rental stock now advertised in both Melbourne and Sydney.

Coates said people looking to buy a home are also struggling as sales are “unbelievably low” at the moment.

“The clearance rates are way down, there is an unusually low amount of inventory in the market right now,” he said. “At this point, very few people looking to sell have chosen to list their properties.”

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