Australians look to share housing in hunt for housing relief

Key Findings:

· 4 percent of Sydney’s households are classified as ‘group’ (unrelated adults living together), rising to 10.8 percent in inner Sydney.

· A quarter of those seeking share accommodation indicated a rental budget of up to $200 per week.

· Less than 5 percent of share vacancies were affordable for those in the lowest income quintile, highlighting while sharing provides a lower cost option, it is not necessarily affordable for very low-income earners.

· Data suggests a tight market for share housing vacancies, mirroring the formal sector.

· While the share housing market is a small component of the housing system, it plays an important role in supplying accommodation to those with limited budgets and options.

· Online platforms have facilitated an informal housing share ‘market’, connecting potential sharers beyond their social networks or local area, and enabling rapid and informal increases in rental accommodation during periods of high demand.

The study, ‘Discounted housing? Understanding shared rental markets under platformisation’, recently published in Housing Studies, was conducted by Professor Nicole Gurran, Dr Zahra Nasreen and Dr Pranita Shrestha from the Sydney School of Architecture, Design and Planning.

Using Sydney, one of the world’s most expensive housing markets, as the case study, the researchers examined how people are seeking share accommodation using listings via online platforms, such as Flatmates.com.au, in the absence of a sufficient government response to an unmet housing need.

Living in a share house, ‘flatting’, or bunking with ‘roomies’, has long been regarded an important rite of passage for younger adults leaving the family home.

However the rising barriers to home ownership and a shortage of affordable rental supply means that sharing is playing an increasingly important role.

“Within these contexts, new sharing practices and informal markets for shared accommodation are emerging, often via online platforms. Through these platforms we are seeing a sustained demand for share housing exceeding the advertised supply rates,” said Professor Gurran.

“In fact, this demand was despite a period of low population growth over the COVID-19 pandemic, and despite wider opportunities to relocate to potentially lower cost housing markets while working remotely.

“This sustained demand for share housing implies that in expensive cities such as Sydney, affordability pressures are sufficient to outweigh preferences for privacy, autonomy, or housing amenity.

“As we know, there is a chronic shortage of affordable housing, and the longer-term implication of this study adds to the extensive volume of research demonstrating that policy intervention is needed to support and subsidise affordable rental housing in high demand locations.

“It is also important therefore, to ensure that future residential developments are able to accommodate different household types.”

The study found demand for shared housing followed the contours of Sydney’s overall housing market, gravitating to accessible locations near central employment areas, universities, train lines, or beachfront areas where amenities were easily accessible.

With vacancies being created within the existing housing stock – often due to existing tenure arrangements – the supply of share accommodation is likely to increase with higher housing costs, affordability burdens, and reduced vacancies across the formal rental market.

This informal market is becoming increasingly important as a default market to unmet housing needs. This is especially the case for vulnerable people in the housing system, those with income constraints, young people at transitional points in their life as well as workers looking for accommodation close to their job locations.

While these online platforms may support an increase in the housing market’s flexibility and responsiveness, the researchers say it also brings potential new risks for vulnerable renters , such as those with special housing needs, which therefore demands scrutiny and policy intervention.

In this way, platform- enabled sharing might be regarded as an informal and rapidly responsive ‘release valve’ for the overall housing system during periods of high demand. And it is likely that the role of platform- enabled sharing may become even more important when population growth resumes.

“The rise of online accommodation platforms opens new opportunities to view these hidden arrangements, while also propelling new practices and policies.” Said Professor Gurran.

“The policy opportunity is to repurpose platform technology for social good – connecting the diverse groups of people now unable to access affordable rental housing in the private market – with appropriate and secure alternatives.”

Declaration: This paper is part of an Australian Research Council (ARC) funded research project (project ID: DP200103202) on urban planning and informal housing supply in Australian cities.

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