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Landlord considers $100 rent rise for single mum who fears she won't be able to afford food

'Can't mix business with emotions.'

A landlord is reconsidering a $100 rent increase to a single mother with two kids after the tenant came back to say she wouldn’t be able to afford food.

Landlord Kristie said "you can't mix emotions with business" when she explained her intention to increase the rent at one of her four properties after calculating a “fair” market valuation to be a $140 weekly jump. The property is in a lower socioeconomic part of Perth, which has the tightest rental market in the country and the biggest increase in asking rents this year.

“I recognise that she probably couldn't afford that. So I came to the conclusion that $100 would be a very good deal considering the suburb and it would be one of the cheaper rentals on the market,” she said in the now removed video.

Do you have a story? Contact belinda.grantgeary@yahooinc.com

A landlord speaking about a rent increase for her tenant.
A landlord is reconsidering a rent increase for a struggling single mum. (Source: X)

“My property manager said if I pass on that increase, [the tenant] won't be able to feed her kids, and she'll be in severe financial difficulty.”

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The landlord questioned whether she should “subsidise” the rent and cover increased costs to her mortgage and land tax out of her own pocket, or tell the “good tenant” she should look somewhere more affordable.

“It's a really tough decision and one that I am not taking on lightly and just further evidence that this housing crisis is really impacting people financially,” Hannah said.

About a week ago, Kristie mulled over the “struggle” she was having with the increase, which would kick in next year.

“It’s a bit of a dilemma to be in. Do I increase the rent and ask the tenant to readjust their lifestyle or do I absorb the cost and the property could be a negative cash flow for me next year?”

Last week a real estate agent defended an email sent to tenants ahead of Christmas, warning it was "eviction season" and to ensure rent is prioritised.

In the face of criticism, Joseph Abraham from Professionals Taylors Lakes simply said "landlords aren't millionaires".

“Many of our landlords rely on rental income to make ends meet. For instance, many of our landlords are first-home buyers who rely on rental income to meet their mortgage repayments in the face of high interest rates,” Abraham told Yahoo Finance.

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National Shelter CEO Emma Greenhalgh said Australian tenants have been “smashed with enormous rent hikes well beyond income growth” this year. The harrowing reality for many - particularly in markets where there are simply no other rental options available - is that they end up under-housed (couch surfing like this mum), or even homeless and living in a tent beside a highway like this man.

There are 3,000 Australians who will reach out to homeless services every hour, according to the Australian Institute of Health and Welfare’s homelessness report.

Leading property expert and Domain's chief of research, Dr Nicola Powell, predicted more tenants would be making the leap to buying a property next year as the rental market reaches a “tipping point” and over-extended landlords “divest” in early 2024.

She said the pressure from record-high asking rents and a frustration with a lack of control or rights would force people to start making compromises on things like location or number of bedrooms.

“A lot of renters have just gone, ‘Well, we need to break into the housing market or we're never going to catch up’ and that’s the mentality many people now have,” Powell told Yahoo Finance.

Perth woman Brooke said she no longer wanted to be at the mercy of a landlord when she found out she could buy an apartment in the same area, with just a $10,000 deposit, and is now paying less than she was in a rental.

“The option of going into another place, paying higher, competing against other people, and then in 12 or six months’ time, the landlord turning around and saying, ‘Oh, we are selling too’, it’s not ideal,” Brooke told Yahoo Finance.

Some have responded to Kristie with support for her business decision to increase the rent, given the extra financial pressures landlords are also facing. Others have said her investment is no longer viable and that it’s not a tenant’s responsibility to cover her costs.

Before removing the video, Kristie indicated she may not have made her final decision.

“I’m not going to see her and her kids on the street. She’s a good tenant. I’m reflecting on my decision and taking some time to decide what to do,” she said.

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