More renters priced out of Melbourne due to extreme affordability issues: report

Melbourne businesses may need to subsidise rents for hospitality workers as rental affordability in the inner city rises further out of reach, experts say.

The December Rental Affordability Index, released on Wednesday, showed 12 suburbs were severely unaffordable for hospitality workers – with rents up to 60 per cent of incomes – while a further 60 suburbs were classed as unaffordable, with rents between 30 and 38 per cent of incomes.

Rents would have to be lower than 15 per cent of a household income to be affordable and between 20 and 25 per cent to be acceptable, the biannual report, released by National Shelter, Community Sector Banking and SGS Economics, showed.

Suburbs including Melbourne CBD, Fitzroy, Richmond and South Melbourne were severely expensive for a hospitality worker on an income of $55,000, and others such as Rosanna, Oakleigh East and Maribyrnong were found to be unaffordable.

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