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Rent capping

7 August 2019

Ms O'CONNOR (Clark - Leader of the Greens - Motion) - Madam Speaker, I move -

That the House:

(1) Agrees that:

(a) housing is a fundamental human right, and is foundational for participation in society;

(b) affordable rent prices are essential for equal participation in society and social mobility;

(c) Hobart is now the least affordable capital city in Australia;

(d) sharp increases in rents as a result of the housing supply squeeze and increase in short stay accommodation listings have forced many Tasmanians out of their homes, communities, and into homelessness; and

(e) the current trend of rent price increases is unsustainable and unjustifiable.

(2) Amends the terms of reference of the Select Committee on Housing Affordability by inserting the following after paragraph (k):

(ka) regulation of rent price increases, with particular reference to the ACT model.

Madam Speaker, a vote will be required but I am hoping that we can agree on the substance of this motion and not have to divide because I believe everyone in this House recognises that housing is a fundamental human right, that it is foundational for participation in society. To be able to afford to pay your rent is essential for equal participation in society and social mobility.

We all know, the evidence is there right in front of us, that Hobart is now the least affordable capital city in Australia. This is coupled with the fact that, broadly, Tasmania is the poorest state in the Commonwealth. We have about a third of our population dependent in some way or another on Commonwealth welfare support.

There have been, and I am sure members in this place have had constituents come and speak to them about the huge increases in rents as a result of the housing supply squeeze and also the unchecked increase in shortstay accommodation such as Airbnb and Stayz, which has forced many Tasmanians out of their homes, communities and too many into homelessness.

We believe that the current trend of rent price increases is unsustainable and unjustifiable. We want to see the Select Committee on Housing Affordability specifically examine the question of rental affordability, justifiable rent increases and whether there should be a system like they have in place in the Australian Capital Territory where rent increases, in broad terms, are capped at the consumer price index. We seek to amend the terms of reference of the Select Committee on Housing Affordability by inserting the following after paragraph (k):

(ka) the regulation of rent price increases, with particular reference to the ACT model.

The work of the Select Committee on Housing Affordability is important work. It will be the first time that this parliament has examined the current state of housing in Tasmania, whether it is the real estate market or the social housing market, how much affordable housing there is and those questions of supply that, we can all agree in here, urgently need addressing.

Unfortunately, when the Greens yesterday asked the Minister for Housing whether he would consider a policy of instituting caps on unjustifiable rent increases he called it a thought bubble. That is very disrespectful to the Tenants' Union of Tasmania which has called for caps on rent increases. It is very disrespectful to the legislature of the Australian Capital Territory which has had caps on rent increases in place since 2011. One of the things that the minister said in dismissing this idea is that it will be a disincentive to investors. That has not transpired in the Australian Capital Territory, which still has a thriving and viable real estate market where investors would appear to be more than happy to invest their money into property in the ACT and to rent it out.

To argue that the market will take care of the soaring rents that people are facing in Hobart is to deny the reality of the market's incapacity to get policy right that puts people first. The most glaring and tragic example of this is global heating. That is a consequence of an unchecked, a psychopathic market where profit was put over people every time and now the planet is in deep trouble. As we know, the planet will probably survive but a question mark hangs over every living thing on it. The market will not fix the situation that has been experienced by renters in Tasmania. The market has driven the rise in Airbnb and short stay accommodation and the market is pushing up rents.

As I said yesterday, there was a young woman at the launch of Homelessness Week and you were there, as was the Minister for Housing and Ms Standen and this young woman, Orana (TBC). Her family had been made homeless because their rent was jacked up by 70 per cent. It made it impossible for her family to retain that home. We know that the people who are most at risk as a result of the housing supply shortage are young people, single parent families, and older Tasmanians. They are people who are at the front line of the market's failure to ensure there is a fair rental system in Tasmania and enough supply of social and affordable housing.

We cannot leave it to the market, the god of the market, which the Liberals worship each morning prior to breakfast. We cannot leave it to the market to fix this chronic social problem. WE know it is not just a social problem. It is an economic problem as well because once people do not have secure and affordable housing families are at risk of breaking down. Schoolchildren do not go to school. There are enormous obstacles to skills development, training, employment and to being able to have a happy life.

We are firm in our view that there needs to be some sort of control over the soaring rents that people are experiencing in Tasmania. There have been stories of households that are on $235 per week rent being told by their landlords that the rent is going up to over $400 per week. If you are a low-income family that is an unaffordable rent. The next step for you, regrettably, as a result of this Government's failure to invest in supply, is homelessness or deep housing distress.

Yesterday when we talked to the minister about the need to cap rent increases in some way or another he talked about the role of the Residential Tenancy Commissioner. There is a story in the real estate pages of the Mercury newspaper dated 23 February last year. The story headline is, 'Residential Tenancy Commissioner rules 70 per cent rent increase reasonable'. The tenants were told by the Office of the Residential Tenancy Commissioner that the 70 per cent rent increase for their West Hobart unit was deemed reasonable. It goes on to talk about West Hobart's (TBC) Kathleen Garity, 63 years old, again falling within that high-risk group, who receives a fortnightly $732 widow's allowance from Centrelink. She has lived in her one-bedroom unit for 15 years. In late November of 2017 Ms Garity was told that her $175 a week rent would increase to $300 a week, that is a 70 per cent increase from 31 January. She was given a little under three months' notice, and this was after her landlord had engaged a property management company. Ms Garrity was originally told that the property management company wanted to increase the rent to $350 a week, which would have doubled the rent that she paid, but her landlord offered a discounted rate because she was a long-term tenant. Well, a discounted rate of $300 a week when you are on $732 a fortnight means that more than half your income would be spent on rent. That means there is no money left over for food, transport and the other necessities and pleasures of life.

We have put questions on notice in relation to the Residential Tenancy Commissioner.

In relation to the period of 1 July 2016 to 1 July 2019, which is the period in which we saw rent and shortstay accommodation listings soaring at the same time, we are asking the Government to detail to the House the number of applications lodged under section 23(1) of the Residential Tenancy Act of 1997; the number of applications determined by the commissioner in favour of the tenant; and the number determined in favour of the landlord. We would like to know the number of applications determined by the commissioner in favour of the tenant referred to a court under section 23(5) of the Residential Tenancy Act 1997; of the cases referred to in question three - the number resolved by the courts in favour of the tenant and the number resolved in favour of the landlord. We would like to know the number of applications determined by the commissioner in favour of the landlord referred to a court under section 23(5) of the Residential Tenancy Act; and the cases referred to in question five; the number resolved by the courts in favour of the tenant and the number resolved in favour of the landlord.

This is no reflection on the Residential Tenancy Commissioner. This is an attempt to obtain information about how tenants' rights can be protected through the Office of the Residential Tenancy Commissioner and whether that office is an effective mechanism to prevent unscrupulous landlords from gouging their tenants. We know it is happening and if you talk to the Tenants' Union of Tasmania and not dismiss their concerns as a thought bubble, minister, you will hear really confronting stories of long-term tenants for whom some or all of their income comes from the Commonwealth, who are living in fear of raising concerns with their landlords about maintenance or heating in the house because they are worried about being evicted. You have tenants who are living in houses that are unfit or unsafe for which the landlord, under the Residential Tenancy Act, has a responsibility to undertake those repairs and maintenance but the tenants are not raising those issues because they live in fear of homelessness. That is the situation we are in now.

We need to do more to protect the rights of tenants and we know there are likely to be some amendments coming into the Residential Tenancy Act. We will be moving amendments that tip the balance of the act more in favour of the tenants because the balance of the act now favours the property class.

When I asked the minister this morning about the 20 housing Tasmania tenants who were evicted during the period that the Gregory Parsons case was before the Supreme Court, he deflected in his answer. How many of those 20 tenants were evicted under section 42(1)(d) of the Residential Tenancy Act, which relates simply to the expiry of lease? We have made this point in here before: Housing Tasmania is not your average landlord. Housing Tasmania has to be a model landlord. It cannot simply apply the baseline that is in the Residential Tenancy Act, particularly at a time when we have a housing crisis. The question we asked this morning was, how many of those 20 tenants had been given the opportunity through the Government's so-called three strikes and you are out policy to address concerns about their tenancy if there were any concerns? How many of those 20 tenants were simply evicted because their leases had expired? That is the question that the minister avoided answering.

We will persist with this line of questioning until we have real transparency about the metrics Housing Tasmania is applying to the evictions of tenants. It is not good enough for the minister to say eviction is always the last resort. We do not have evidence of that. During my time in that portfolio, it was Housing Tasmania policy not to evict people into homelessness. We do not know if that remains Housing Tasmania policy but I would be very interested to know what sort of follow-up has been done on the 20 tenants who were evicted at a time that the Supreme Court was hearing a case in relation to Housing Tasmania's eviction policy. We need to protect tenants, whether they be in the private rental market or in the Housing Tasmania portfolio of properties.

The ACT model has been in place for eight years. In the ACT, rent increases are limited to once every 12 months and tenants have a right to eight weeks' notice in writing. Excessive rent increases can be disallowed and rent reductions can be ordered. Rent increases in the ACT are covered by the Residential Tenancies Act 1997. As it is with our act, the terms of every tenancy are set out in the RTA and standard lease and known as the standard terms.

Unfortunately, we do not have standard leases in Tasmania. We have a range of different classes of tenant. This is something Shelter Tasmania and the Tenant's Union of Tasmania have been calling for some time, that there be a standard lease so that you do not have landlords and property agents putting clauses in leases or the residential tenancy agreement that are unlawful or questionable in law. If a landlord applies an increase to a rent but the tenant believes is excessive, they can apply to the ACT Civil and Administrative Tribunal for a rental rate review. The ACT tribunal has a formula linked to the Consumer Price Index, which is applied to determine the onus of proof. If the proposed amount is greater than the calculated figure the landlord must satisfy the tribunal that the increase is justified. If the increase is less the onus is on the tenant to satisfy the tribunal that the increase is unreasonable.

We cannot see that this is radical policy. What justification can there be for a landlord telling a long-term tenant who is on a widow's pension that they are going to almost double the rent they are charged? What is happening to these tenants? I know a person who is on, as I said yesterday, a disability support payment. Their rent has been $220 a week, a couple of weeks ago they were told the rent is going to go up another $20, so that is $240, $480 a fortnight out of a disability support payment. Every member of this House knows that Commonwealth rent assistance is capped, so there is a cap on CRA, people who receive Commonwealth rent assistance and rents keep going up because the market is driving them up, and you are going to have a new cohort of tenants who are living well below the poverty line and at higher risk of homelessness.

We have a responsibility in this place to make sure we are giving effect to good policy and improving legislation. Tasmanians would be expecting us to do that in the best interests of them and at the moment we have this Government's inability to do anything that offends the property class. Even with the glaring evidence presented by the Institute for the Study of Social Change that Airbnb listings have not peaked yet, that there is a saturation of the market, we have no action from this Government. When we sought to have a pause placed on Airbnb listings in May 2018 every single Liberal member voted against that and all we have from the minister is a data-gathering exercise, as I understand it. There has been no update in the House -

Mr Jaensch - Then you will have evidence for policy making.

Ms O'CONNOR - The evidence was presented to you, Mr Jaensch, by the Institute for the Study of Social Change.

Mr Jaensch - That's not evidence.

Madam SPEAKER - Through the Chair, please.

Ms O'CONNOR - That is very encouraging, Mr Jaensch. What you seem to be implying by omission is that if the evidence comes back and says that Airbnb and Stayz listings are out of control and shutting people out of the affordable rental market, you may well take action.

Mr Jaensch - You'll have evidence to make policy on, as will council.

Ms O'CONNOR - That does not apply to climate change, of course, because the evidence is there. You are part of a government that refuses to take effective action, but I am moderately encouraged by your statement by interjection that if there is the evidence then you may well change something. The evidence, particularly in Greater Hobart, is there. There is no question of that whatsoever. From a property owner's point of view it is often far more profitable and less problematic to put your house onto Airbnb. We know that is happening. I look forward to the minister, Mr Jaensch, presenting whatever data that has been made available through that process to this House at the earliest opportunity.

Should this motion pass, we may well seek to have some of that information presented to the housing select committee because we too need data and evidence. The evidence we are hearing from constituents, people who are living on the margins, single parents, young people and the elderly, is that they simply cannot find an affordable rental. That is the evidence. Part of the problem, of course, is short-stay accommodation, but the other part of the problem is the lack of supply, something for which the Liberals must take some responsibility having spent the first term of the Liberal Government not addressing the housing supply crisis but instead pouring money into roads and bridges and ignoring the need to increase the supply of social and affordable housing. The evidence is very clear that we need to do something to make rents fairer and more affordable for low-income Tasmanians.

Madam Speaker, I commend the motion to the House.