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COVID-19 and Rising Financial and Housing Insecurity

11.01.23


by Katie Ho, Senior Project Lawyer and Verena Tan, Policy and Advocacy Lead at Justice Connect Homeless Law

This article was originally published in Parity magazine. Learn more about Parity magazine including how to access full editions.

Using Dear Landlord to Support Victorians Facing Eviction for Falling Behind in Rent

For many Victorians, the past few years have been an unprecedented experience. Community members have suffered through extensive, strict lockdown conditions to manage the spread of the COVID-19 virus. Initially set for four weeks, the state of emergency in Victoria declared on 16 March 2020, continued in Victoria over the following two years.

The impact of these restrictions took a significant toll on individuals and left many Victorians without any income or financial supports to cover their cost of living. Many people were unable to pay rent because they were experiencing financial problems, putting people at risk of eviction into homelessness for the first time.

This article talks about the ways that Justice Connect Homeless Law (Justice Connect) responded to the significant need and demand for legal advice and support in relation to housing. Justice Connect provided legal supports to thousands of Victorians during and following the pandemic. By looking to creative digital solutions, we were able to help more people than our regular legal services could. The learnings we gathered from these past few years have been invaluable. They tell us the story of what people were experiencing during the COVID‑19 pandemic and the essential need for early, tailored legal and financial assistance to prevent evictions.

Legal Protections During COVID-19

When Victoria went into their first period of lockdown, it was clear that renters were going to be vulnerable to eviction in at the height of a public health crisis. Justice Connect and our tenancy assistance sector allies came together to call for better protections for renters affected by COVID‑19. After significant, evidence‑based advocacy from the sector, on 25 April 2020, the Victorian government put in place an ‘eviction moratorium’ to prevent renters from being evicted into homelessness and to pause any rent increases.

The Victorian eviction and rent increase moratorium lasted between 29 March 2020 and 28 March 2021. Alongside supplements to Centrelink payments, the moratorium ensured that many renters were able to stay housed and maintain their rental payments. However, once the moratorium ended, the demand on community services for legal, financial and housing help increased exponentially, and this has continued throughout 2022 despite an easing of Victoria’s COVID‑19 restrictions.

Dear Landlord: Digital Self-help Tools for Early Intervention

Dear Landlord is Justice Connect’s free online self‑help tool supporting renters in Victoria to avoid eviction. First launched in 2018, Dear Landlord aims to help renters to understand their rights, build confidence, and take steps early to get back on top of their rent payments. We updated Dear Landlord in response to COVID‑19, so renters had timely and trusted help in seeking a rent reduction from their landlords.

We further updated and relaunched Dear Landlord again on 29 March 2021 to help renters navigate Victoria’s new rental reforms.

In the first six months of the new rental laws, Dear Landlord was accessed by more than 28,000 users. This was a 115 per cent increase in users from the previous six months, reflecting the increase in renters facing eviction for unpaid rent.

The average amount of rent arrears per Dear Landlord user was $2,580. Seventy percent of users were behind in rent by up to $3,000, while two per cent had accrued arrears above $10,000.

With the rollback in COVID‑19 government supports, renters continued to face more financial hardship than ever before. Being behind in rent upwards of $2,500 puts pressure on daily living expenses and is difficult to pay off without extra financial support, leaving renters at real risk of eviction. However, this data also indicates that with the right combination of 18 targeted legal and financial support, many Victorian renters can be supported to address their rental debts and stay securely housed.

Financial Problems Due to COVID-19 Increased Housing Insecurity

The COVID‑19 pandemic added more pressure to this existing affordable housing crisis. According to data from a recent report from ANU, the number of Australians who couldn’t pay their rent or mortgage on time has more than doubled due to COVID‑19.

Justice Connect’s existing cohort of clients have often been experiencing or on the brink of homelessness. They have regularly experienced financial and housing insecurity over periods of time, or in some cases for most of their life, particularly due to the growing issues around lack of affordable housing in Australia. As a result of COVID‑19, Justice Connect saw a new cohort of people at risk of homelessness for the first‑time, including those identifying as ‘recently unemployed’ or ‘on a reduced income’.

People who have not experienced financial or housing insecurity often have less experience seeking help, so might struggle to find appropriate support services. Additionally, many people see tenancy or housing issues as financial problems not legal problems. We know from experience that employment and financial problems can be the early warning signs that lead to entrenched poverty.

The pandemic also exacerbated women’s housing and financial insecurity. This was reflected in the overwhelming use of the Dear Landlord tool by women, with more women (62 per cent) using Dear Landlord compared to men (38 per cent). For many of these women, family violence was reported as one of the reasons they were unable to pay rent.

The other overwhelming responses received through Dear Landlord point to unemployment and underemployment as the key reason why renters were unable to pay rent. Many renters seeking help were unable to meet financial obligations, particularly when additional COVID‑19 specific support such as JobKeeper and the JobSeeker supplement ended.

Digital Tools Offer Opportunities for Early Intervention

In the six months after the re‑launch for Victoria’s new rental laws, 93 per cent of Dear Landlord users were new to the tool. Coupled with our data in relation to renters’ early use of the Dear Landlord, this low number of return users provides evidence that effective support upstream leads to longer term, sustainable outcomes by getting on top of rental hardship earlier. We are currently conducting further longitudinal research to better understand the long‑term impact of the tool, recognising that there are multiple influencing factors contributing to financial and housing insecurity.

As we move forward, Justice Connect will continue to gather insights through Dear Landlord as we return to ‘COVID‑19 normal’. We have been focusing on research and discovery to deepen our understanding of renters’ financial support needs, with the aim to iterate Dear Landlord based on these insights. Using our learnings and evidence‑based casework, we will also continue to advocate with our community and government sector partners to ensure renters’ rights are being protected.

Moving Forward: What We Need to Keep Australians Safely Housed

Despite the easing of the majority of Victoria’s COVID‑19 restrictions, we continue to see that renters are still experiencing stress, hardship and insecurity. People are at risk of homelessness more than ever. Based on our learnings from Dear Landlord, along with our specialised, integrated legal services for people experiencing or at risk of homelessness, we see several key levers that would help Victorians to navigate the housing and financial insecurity challenges following COVID‑19. In particular:

More access to digital self‑help tools for renters: Given the right information and support at an early stage, many people can help themselves to negotiate with their landlords and find solutions to maintain housing. We have seen that self‑help tools like Dear Landlord can assist many thousands of people avoid eviction and address financial and housing issues before they become complex legal problems.

Ongoing brokerage and rent relief grants: Our Dear Landlord data shows that most people behind in rent owe less than $3000. With a small amount of financial support, many of these people would be able to pay off their rental arrears and maintain their housing. Financial brokerage and one‑off rent relief grants are essential to supporting people who have had some financial insecurity but need that little extra help to stay on their feet and avoid further disadvantage.

Targeted legal and social supports for the most disadvantaged: To address the growing needs of the people who are most at risk of homelessness, we need specialist and targeted supports for women, including those experiencing family violence, as well as people sleeping rough and people in or exiting prison. These groups of people are particularly at risk of homelessness and directly benefit from wrap‑around legal, financial, social and health supports to maintain secure housing.

Raise the rate of social security: With the increase in the cost of living in Australia, especially the cost of housing, the rate of social security payments is too low to make ends meet. The COVID‑19 pandemic showed how essential social security is as a safety net for all Australians. We need to increase payments to all social security payments to be proportionate to the increased cost of living and ensure that people do not have to choose between basic needs like rent, food and medical care.

More social housing: To fix the housing crisis, we need for more social housing. Social housing means that all Australians are entitled to a roof over their head and a safe place to live. Without adequate social housing more and more Australians will be at risk of chronic rental stress, eviction and homelessness.

This article was originally published in Parity magazine. Learn more about Parity magazine including how to access full editions.

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