A recent study titled "Unaffordable Australia: The Surprising Income You Need to Rent Comfortably" has unveiled the significant income gap renters face in Australia's most sought-after suburbs.

Compiled by MCG Quantity Surveyors, the report sheds light on the top 10 suburb areas across Australian capital cities and states where the disparity between current incomes and what is necessary to afford rent comfortably is most pronounced. The rate considered affordable is 30% of someone's income.

Not surprisingly, Byron Bay has the largest renter gap to income in Australia. The data shows that 60% of income is required to rent in Byron and that an income of $3,805 per week is required to rent comfortably.

In regional NSW, you only had to look at properties stretching north of Byron Bay to find the rest of the Top 10, places like Banora Point (near Tweed) 55%, Kingscliff/Fingal Head 51%, Brunswick Heads/Ocean Shores 49%, Pottsville 48%, Tweed Heads (52%) and even Ballina is at number 6 (53%).

Mike Mortlock, Managing Director of MCG Quantity Surveyors, comments on the report's findings, "This study reveals the harsh reality many Australians face—a reality where the dream of living in a prime location is increasingly out of reach due to the widening gap between wages and rental prices."

"The report not only highlights the top 10 affected suburbs but also delves into the broader implications of this gap on local economies. "When a significant portion of a household's income is dedicated to rent, there's less available for other expenditures. This isn't just a problem for renters; it's a challenge for the entire local economy," Mike adds.

For Lismore (the state electoral division), the percentage is not much better.

The average income from the 2021 Census from the Australian Bureau of Statistics was $1,202, and the average weekly rent was $300, which represents nearly 25% of income.

Some assumptions have to be made on weekly income in 2024, but let's say a 10% increase over 3 years, so $1,322 and looking at rental properties, the average is around $550 per week. This represents about 42% of weekly income.

Local real estate owner Andrew Gordon (R Gordon and Son) told the Lismore App that there is a lack of supply.

"When did you last see a block of units built in Lismore? During the flood, we lost 140 rental properties, and we have not replaced them," Mr Gordon said.

"There is an element of our population that is low socio-economic, so they usually rent as they are not in a position to buy, and investors are not buying investment properties. I believe it is generational. The younger generation wants to own their own home and then go on holiday and enjoy life, not buy an investment property."

"Then you have the cost of owning an investment property. This has increased greatly in the last couple of years through interest rate rises, insurance has doubled, and maintenance costs have increased. Investors want to get a return on their investment, so prices go up. They are not in it to go backwards."

Back to Mike Mortlock.

With an emphasis on the critical need for affordable housing solutions, Mike urges policymakers and industry stakeholders to consider the report's findings as a call to action. "We need innovative solutions to bridge this affordability gap. It's imperative for the sustainability of our communities and the overall health of our economy," he asserts.