HOMELESSNESS is climbing the income ladder as housing affordability reaches its worst levels on record, with soaring prices and rents the driving factor behind a 22% surge in people experiencing rough sleeping over the past three years.
This year’s Australian Homelessness Monitor revealed that persons newly assisted by agencies and having recently slept rough increased from a monthly average of 3,808 to 4,636 persons over the three years to FY24. In NSW, rough sleeping has skyrocketed by 51% since 2020, largely driven by an increase in regional communities.
High mortgage rates and soaring prices has made housing affordability increasingly difficulty, as Australians work overtime, take on second jobs, and even skip on healthcare costs in a bid to break into the heated market, while having to deal with sky-high rents and crushingly low vacancy rates in the rental market.
“Rental affordability stress has deepened to such a degree that more people are being forced into situations of severe instability and rough sleeping,” Professor of Housing Research at UNSW Sydney and lead report author, Hal Pawson said.
“Median rents have increased 51% since the COVID-19 pandemic and there has been only a marginal expansion of social housing.”
“Many support agencies are at a breaking point. Staff are operating in a completely clogged system. People exit support services into the same homelessness they were trying to escape.”
The research, by UNSW and University of Queensland in partnership with Homelessness Australia, also found that the risk of homelessness has been affecting a broader range of people, with an increasing proportion of workers seeking crisis support.
“The biggest driver of homelessness is actually people not being able to afford somewhere to live. And that’s not a huge surprise because we know that there are 640,000 people who need social housing but can’t get access to it because waiting lists are just so long and because governments haven’t prioritised it,” national housing crisis fix campaign Everybody’s Home spokesperson Maiy Azize told Australian Property Journal.
“We’re now seeing that homelessness is climbing the income ladder.”
The report showed 15% of people who are in services now are people who are working.
“They’re people who are in paid work. There is no reason why people who are holding down jobs should not be able to afford a place to live without having to turn to homelessness services. But what we’re seeing is just that our property market is so hot that people just can’t afford anywhere,” Azize said.
The Homelessness Monitor has shown that about one in three people who seek help from specialist homelessness services in Australia are getting turned away.
“What we’re seeing now is that the cumulative impact of years and years of pressure on this sector is really taking its toll – years of underfunding at the same time as demand grows and grows,” Azize said.
Chronic capacity constraints
The report noted that while homelessness services have seen continuing increases in typical monthly caseloads – up by 12% since FY20 – their ability to accept new referrals has been increasingly restricted by resource capacity constraints.
“This has arisen because the task of assisting people into secure housing has become increasingly difficult; a challenge that has continued to intensify into 2024,” the report said.
More than three-quarters of homelessness services (76%) reported finding it “much harder” to find suitable housing for clients in mid-2024 compared with 12 months earlier, according to the report, with another 19% finding it “somewhat harder”.
Total government homelessness expenditure rose by 31% in real terms in the four years to FY23, but this has been “generally insufficient to expand service capacity in line with rising need”, the report said.
“One result of growing demand outpacing service capacity has been that agencies have been increasingly unable to provide support to assist people to avoid homelessness, as they focus on responding to crisis.”
Homelessness Australia CEO Kate Colvin said much more must be done to address what has become a homelessness emergency.
“Homelessness is no longer confined to the most vulnerable.
“Funding for homelessness services has failed to rise to meet demand and the whole system is buckling under the pressure. Governments need to take immediate action and deliver an emergency homelessness investment so that when people reach out for homelessness support there is someone there to help them.”
The report found there were 2,041 rough sleepers counted in NSW in 2024, up from 1,353 in 2020. All of the increase was in regional NSW, with the number of rough sleepers counted in Sydney slightly decreasing from 683 to 574 over the four years.
The report also found that despite the growing demand for housing, social housing allocation in NSW have only remained relatively stable at around 9,000 lets per year. Priority housing allocations have increased from 5,000 in FY20 to nearly 6,500 in FY24, suggesting a focus on at-risk populations – but a severe shortfall of social housing remains.
Social housing as a proportion of all housing has sunk from over 6% in the 1990s to barely 4% by 2021. In a “striking” reversal, however, new investment pledged by both state and Commonwealth governments since 2020 looks set to see the delivery of around 60,000 new social homes during the current decade, the report estimated.
Allowing for public housing demolitions such as the 44 towers around Melbourne and sales, the net addition to national social housing stock during the 2020s may total around 50,000 dwellings, it said, equating to an increase of around 11% on the 2023 national portfolio. However, this will not make a big impact on the amount of social housing as a proportion of all housing.
Community housing provider organisation PowerHousing Australia has unveiled the ambitious target of making one in every 10 homes social or affordable within 20 years.
Commercial building repurposed for rough sleepers
Release of the report came on the same day of the official opening Make Room on Little Bourke Street, a six-storey former commercial building in Melbourne’s CBD that has been converted into homes for up to 50 people experiencing rough sleeping.
The $24.9 million redevelopment has been delivered in partnership with Victoria’s Allan government, City of Melbourne, Unison Housing and philanthropic donors with the state government investing $9 million in capital funding as well as a further $5.2 million for on-site support and specialised tenancy management.
Make Room residents are expected to move into the studio apartments from January 2025 and can stay for up to 12 months.
“We know that housing projects like Make Room provide life-changing outcomes for people experiencing homelessness. Providing a safe place to sleep, and access to tailored support services is the first step in making that a reality,” Victorian Minister for Housing Harriet Shing said.
“This new project is not just giving people a safe and connected place to call home, it’s providing the wrap-around services to address many of the root causes of homelessness.”
