What is rent assistance and who is eligible for it?

If you’re having trouble affording to pay your rent, you might be eligible to receive rent assistance from the government.

• What is rent assistance?
• Who is eligible for rent assistance? 
• Who isn’t eligible?
• How much rent assistance can you get? 
• How to apply for rent assistance
• Is rent assistance enough? 

If you don’t own a home, rent is one of those things in life we just have to pay - like taxes.

But if you’re struggling to afford your rent and you currently receive another form of payment from the government, you could be eligible for some help with your rent payments.

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What is rent assistance?

Commonwealth Rent Assistance (CRA), also just known as rent assistance, is a Centrelink payment that certain people who have to pay rent and currently receive some form of payment from the government (like the age pension) can receive.

Who is eligible for rent assistance?

You can receive rent assistance from the government if you currently receive any of the following:

• The Age Pension, Carer Payment, or the Disability Support Pension

• ABSTUDY Living Allowance, Austudy, or Youth Allowance

• Widow Allowance

• Partner Allowance or Special Benefit

• Family Tax Benefit 

• Parenting Payment (partnered and single), and

• JobSeeker or a Farm Household Allowance

Government data shows one in five (20%) of those receiving rent assistance were also on JobSeeker, the Age Pension (22%) or a Disability Support Pension (20%).

You must also pay one of the following to be eligible for rent assistance:

• Rent, board or lodging

• Retirement village fees, and

• Site or mooring fees if your main place of residence is a relocatable home, like a boat or caravan

Special rules apply for people living in a retirement village and for young people, so it’s best to check the government website.

Who isn’t eligible for rent assistance?

You can’t receive rent assistance if:

• You are leasing from a state or territory housing authority

• You own or are buying the home you live in (but not relocatable homes, see above)

• You are travelling for less than 12 months

• The Australian Government pays a subsidy to an approved residential aged care facility where you live

• Your partner receives rent assistance with Family Tax Benefit, and

• You receive an allowance and your partner receives rent assistance with their pension

If you managed to get all that, keep reading for details on how much money you can get from rent assistance.

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How much rent assistance can you get? 

How much rent assistance you can receive depends on how much rent you pay per fortnight. For every $1 of rent you pay over the below amounts, you’ll receive 75 cents to go towards your rental payments, and you cannot receive more than the maximum amount of rent assistance.

The below amounts of rent assistance get updated every year in line with the Consumer Price Index (CPI).

People without dependent children:

Source: Australian Government Services Australia

People with dependent children:

If you have dependent children, you’ll often receive rent assistance with Family Tax Benefit Part A.

Source: Australian Government Services Australia

From time to time, you may be asked to review and confirm your rent details to make sure you’re getting the right amount of rent assistance, and that your eligibility hasn’t changed.

Your rent assistance may be adjusted if the amount of rent you pay increases or decreases, if you move house, if your income changes, or if your family situation changes (such as getting divorced). The amount of rent assistance you receive could also change depending on changes to the payment rates made every year in line with CPI.

How to apply for rent assistance

You don’t need to submit an application for rent assistance because the government will automatically check to see if you’re eligible when you claim a payment, like the pension, from them. You will likely be asked to provide proof that you pay rent and will need to provide a rent certificate, which will be sent to you to fill out.

If you already receive rent assistance but you’ve moved house, you’ll need to confirm that you’re still eligible to receive it by signing into your myGov account and updating your information.

Is rent assistance enough? 

There are many in the industry who argue the current levels of rent assistance are insufficient, while others argue they're high enough as is. According to the Australian Institute of Health and Welfare (AIHW), 1.29 million people receive some form of rent assistance, and it occupies a large part of our nation's housing assistance spending. However, 41% of CRA recipients were still in rental stress, defined as spending 30% or more of take home income on rent. 

The Government's spending on rent assistance was $4.7 billion in 2019-20, yet some like the Grattan Institute's Brendan Coates say it can be increased at a comparatively small cost. 

According to Mr Coates, raising rent assistance by 40% (an extra $1,400 each year for singles), would cost $1 billion per year, and only $300 million if it was applied to just seniors, which he says may be necessary as more and more retirees look set to be renters instead of homeowners. According to the Grattan Institute, by 2056 just two-thirds of retirees will own their homes, down from nearly 80% today, which would put a huge strain on the budget. 

"The Government’s first priority should be boosting Commonwealth Rent Assistance, which has not kept pace with rent increases over the past two decades," Mr Coates said. 

"Boosting Rent Assistance would do much more to reduce poverty in retirement per government dollar spent than the alternatives, including lifting the Age Pension."

Mr Coates thinks assistance rates should be indexed to changes in rents, as these increases are paid for by those renting. The Productivity Commission itself found cause to boost rent assistance too. 

But others say current income support payments are enough. Speaking during his announcement of a new permanent JobSeeker rate, the Prime Minister himself said that 290,000 JobSeeker recipients who also receive CRA will get $768.80 per fortnight. According to the government, the different payments combined (including the energy supplement) are appropriate. 

Savings.com.au’s two cents

If you’re already experiencing financial stress, receiving rental assistance can greatly reduce some of that pressure. For more tips on managing money and saving, check out our money saving tips.

Photo by Fabian Blank on Unsplash