Annual rent review of public housing
Last published 15 Jan 2018
Currently there are 55,000 households on the public housing waiting list and we need to ensure that public housing properties are provided to vulnerable people in need who don’t have an alternative.
It is important to make sure that everyone pays a fair rent. People living in public housing who do not need a government subsidy should pay the same rent that tenants in the private rental sector would pay for an equivalent property.
The Government sets market rents for all public housing properties and reviews them regularly. In 2013, the Government revised market rents to make them consistent with rents in the private market.
Why do public housing properties have a market rent?
Under the Residential Tenancies Act 2010, the Government charges market rent for all its properties. Most low income tenants do not pay the full market rent as they are eligible for a rent subsidy and generally pay 25% of their household income as rent. This policy has always generally been the case and has not changed.
Why do some public housing tenants pay market rent?
Some public housing tenants may pay market rent as the household income has increased due to employment or because new members have joined the household. If these tenants are on a continuous lease, they are able to stay in public housing as long as they pay rent which corresponds with their income. In addition, in some cases the market rent for public housing is quite low (particularly in regional areas and for smaller accommodation in metropolitan areas). This may mean that the market rent for the property can be less than or equal to 25% of their household income.
What has changed?
Previously these market rents were assessed on the basis that the properties were used for public housing, which meant that the valuations were lower than they would have been had a private market based comparison been used.
Therefore some market rent payers living in public housing were paying significantly less than the equivalent private market rent.
For example, in Waterloo in Sydney, some public housing market rent payers in two bedroom properties have been paying more than $200 less than they would have paid in a privately rented unit.
In addition in Newtown, some market rent payers in two bedroom units have been paying $245 less per week than they should have.
Under the new and fairer system, public housing market rent valuations are set in reference to the rent received in comparable private properties in the area.
This means that the new rent levels better match the rent that would be paid for a similar property in the private rental market.
The new market rent calculation only impacts public housing tenants who do not receive a government subsidy because their income is too high. Currently around 9% of public housing tenants pay market rent.
What if I can’t afford to pay market rent?
If you are on a low income and your rent has significantly increased you may be eligible for a rent subsidy. Please contact your local FACS Housing office and staff will be able to assist you apply for a rent subsidy. FACS Housing will contact tenants that have a large increase in the market rent for their property to invite them to apply for a subsidy.
What if I disagree with the new market rent?
You can contact the NSW Civil and Administrative Tribunal and ask for a review of how your market rent was determined.