News //

The market rate is too damn high

Max Chalmers looks at the bigger picture behind the SUV rent increase.

Students march on Sydney University Village to protest rent increase. Photo: Katya Pesce.
Students march on Sydney University Village to protest rent increase. Photo: Katya Pesce.

When asked to explain why substantive rent increases were necessary for Sydney University Village, General Manager Ron de Haan repeatedly pointed to ‘market forces’ to justify the decision. Fees, he said, had increased because an independent assessment advised SUV they were charging below market rates.

Sydney University’s representative on SUV’s management board appears to agree with this approach to rate determination. The University owns a nominal share of the company and is therefore allocated a seat on the board, which is occupied by David Bennett. Both Mr Bennett and Mr de Haan told Honi Soit that the University uses this position to try and ensure (among other things) that the rent at SUV remains as reasonably priced as possible. Like Mr de Haan, Mr Bennett believed the recent increases were justified and in line with local prices.

Mr Bennett also vigorously defended the right of the company that runs SUV, Campus Living Villages, to seek substantial financial returns for the company and its investors. He did not believe it was wrong for the company to raise prices when it was already profitable.

For the sake of argument, let’s assume that the new pricing is ‘right’, that the SUV management has been accurately guided by the invisible hand and has perfectly distilled the magic market number. Even when we accommodate for this contentious supposition we find a deeper issue at play.

The problem is that the market rate is not affordable for students who pay their own way or don’t come from well off families. Whether SUV should be concerned about this or not hinges on your interpretation of what ethical obligations Campus Living Villages took on when it initiated its public-private partnership with the university. Given the special relationship the two bodies have, it does not seem unreasonable that SUV might strive to help the University fulfil section 4(c) of its Strategic Plan and “provide more affordable and appropriate student accommodation on and near the University’s campuses.” Considering the cheapest rooms at SUV are now $256.80 per week (including utilities), it can hardly be said to be doing so.

The intermingling of public and private spheres poses a theoretical and tactical dilemma for the activist movement that, feeding off general concerns about student welfare, has crystallised around this specific issue. Should the target of student anger be SUV for profiteering? Should it be the University for allowing private development of the site in the first place? Or should it be state and federal governments for developing a system of funding in which universities do not have the resources to develop affordable housing?

With a broad coalition of campus political factions showing at least shallow interest in the issue, there may soon be an opportunity to develop a serious student response to these questions.