The hard truths about our rental crisis

approximately an extra 20% of additional expenses to the normal daily obligations that we all have.

MEET Charlotte. Charlotte and her partner settled on their first investment property in July 2021.

In July 2021, the highly sought-after location of Hawthorn Victoria had a vacancy rate of 10.8 percent! That’s almost ten times what it is today. Eight weeks after settlement, their apartment was leased for a mere $345 per week. This was well below what they expected and budgeted for.

With a locked-in rent of $345 per week for 12 months in a city that was still in and out of lockdowns and under restrictions, Charlotte was required to use her savings to help manage her costs.

In May 2022, interest rates started to lift and, as we now know, lifted for ten consecutive months. Charlotte had to dive further into her diminishing savings to cover the now-increased mortgage repayments. Fearful that they would lose their current tenant, Charlotte implemented a conservative rental increase of $40 per week once the tenant’s first lease expired, bringing the weekly rent to $385 per week. This rent was still at least $100 per week behind where the rental market value should be.

Laws in Victoria only allow rent increases every 12 months, so today, Charlotte’s tenant still pays $385 per week. With increased interest rates, Charlotte is paying an additional $900 toward their loan repayments every month. For Charlotte, that’s