Rising rents affect the most vulnerable

Rising rent costs mean that the city’s most vulnerable families are being priced out of the market, the Salvation Army says.

Salvation Army Dunedin Community Ministries director David McEwen said, even with extra supplements, people were finding their income ‘‘marginal’’ once they were in a property.

‘‘Our clients are often in the red each week with their basic expenses, let alone anything extra like school expenses or car maintenance,’’ he said.

Financial mentors and budget advisers had reported a steep increase in people requesting food and power assistance, and needing it more frequently.

There had also been an increase in people requesting support to complete KiwiSaver Hardship Withdrawal applications, help with debt, and relying on Buy Now Pay Later options for essential items including food.

Budget advisers found most clients were being forced to spend at least 50% of their income on rent. For sole parents with one child it could be significantly more.

People on lower incomes and in financial hardship really needed the cost of living to drop, Mr McEwen said.

As costs were rising faster than incomes, there were no gains for those in the lower or middle income brackets.

Beneficiaries were caught in the same impossible position.

‘‘When benefits go up, landlords tend to put up rents.

‘‘Giving beneficiaries more money does not necessarily equate to real gains for them.’’

The best solution to the rental crisis would be more housing supply.

‘‘Under supply vs over demand equals rising prices.’’

BRENDA.HARWOOD @thestar.co.nz


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