A one-off lifetime portable bond payment would ease financial pressure on renters, according to an Australian public policy institute.
The McKell Institute Chief Executive Edward Cavanough said the Federal Government should introduce a National Portable Bond Scheme which would allow renters to transfer their bond between leases, rather than scrambling to come up with a second deposit before their previous one is refunded.
Mr Cavanough said under the scheme renters would also earn interest on their bond which would potentially build a small financial safety net over time.
He said the policy would relieve significant cost of living pressure and stress from renters.
“Renters are under enormous financial strain and the current need to double-up on bonds to move often traps people in unsuitable housing.
“A National Portable Bond Scheme would put real money back into the pockets of people who often desperately need it.”
Mr Cavanough said the Australian dream of property ownership was out of sight for many, yet political parties remained focused on the interests of homeowners.
He said renters were overlooked and treated as a minority or pitied for their inability to achieve homeownership.
“Renters need to be treated seriously with practical reforms that offer them real benefits today while laying the groundwork for long-term change.”
Mr Cavanough said, currently, landlords and bond-holding authorities were the only people who benefited from the interest that accrued on rental bonds.
He said by earning interest on their bonds, it was estimated renters could accumulate up to $2600 in interest over 10 years, “which could provide much-needed emergency savings if required”.
