Appendix 1Note on definitions
This material is replicated from the ‘Note on definitions’ in Chapter1 of the committee’s interim report.(Senate Community Affairs References Committee, The worsening rental crisis in Australia – InterimReport, September 2023, pp. 3–5)
Note that terms may be used differently or more loosely by submitters and witnesses.
1.15The following section provides definitions on terms used throughout the report, noting that these terms may be used differently or more loosely by submitters.
Housing affordability
1.16The term ‘housing affordability’usually refers to the relationship between expenditure on housing (including rate payments, mortgage payments or rents) and household incomes.
1.17One measure of housing affordability used by the Australian Bureau of Statistics (ABS) is ‘a ratio of housing costs to gross household income, also known as a housing affordability ratio’.
Rental affordability
1.18CoreLogic analysis measures rental affordability by ‘using the portion of median household income required to service rent on a new lease’. ForAnglicare Australia, rent affordability means that ‘rent needs to be no more than 30 per cent of a household budget for it not to cause financial stress and difficult choices’.
Social housing, public housing, and community housing
1.15The Australian Housing and Urban Research Institute (AHURI) describes social housing as ‘government subsidised short and long-term rental housing. Social housing is made up of two types of housing:
public housing, which is owned and managed by State and Territory Governments; and
community housing, which is managed (and often owned) by not-for-profit organisations’.
Housing stress and rental stress
1.19The term ‘housing stress’ is commonly used to describe the experience of those households in the bottom 40 per cent by income that spend over 30 per cent of their income on housing. The term ‘rental stress’ is used in relation to such households in rented accommodation.
Rent freeze, rent cap, rent control, and rent stabilisation
1.20A legislated rent freeze occurs when landlords are prohibited by law from increasing rents for current tenants and, depending on the legislation, may not be allowed to increase rents for new tenants.
1.21A rent cap may restrict the frequency and/or amount that rents can be increased. A rent cap can be calculated using various methods, such as capping rents by a specific value, or by a specific proportion of the rent, or by reference to an external economic measurement like the consumer price index (CPI).
1.22The terms ‘rent control’ and ‘rent stabilisation’ broadly refer to types of rental regulations. According to Better Renting, ‘rent control’ refers to regulation that limits the amount that rents can be increased within and between tenancies, whereas ‘rent stabilisation’ refers to regulations that apply only within, and not between, tenancies. In the United States, rent control generally refers to more stringent regulation that ‘locks in rental rates at a specific amount’, whereas rent stabilisation allows for rents to be increased by a fixed amount.
Homelessness and marginal housing
1.23The ABS defines homelessness as the situation when a person does not have suitable accommodation alternatives and their current living arrangement:
is in an inadequate dwelling;
has no tenure, or if their initial tenure is short and not extendable; and
does not allow them to have control of, and access to, space for social relations.
1.24Categories of homelessness include living in improvised dwellings, tents or sleeping out, boarding houses, and severely crowded dwellings.
1.25Marginal housing encompasses living arrangements that are close to homelessness, including people living in caravans.