Melbourne pensioners are paying as much as two-thirds of their income on rent as Melbourne’s housing crisis continues to worsen.

A new report has found rental affordability has plunged across the city, with university students and single parents among the worst-affected.

Students living in share houses in the inner city are spending up to 60 per cent of their income on rent, according to a new index measuring rental affordability across the country.

The biannual report also found the cost of rent chewed up more than half of many pensioners’ and single parents’ incomes. Single pensioners lost, on average, 68 per cent of their income to rent.

“That leaves very little if anything for other primary needs such as food, heating and cooling the house, medical needs … transport would be very difficult to pay for as well,” said Ellen Witte, partner at SGS Economics and Planning. “We can see that for pensioners the situation is very dire.”

She cited ongoing concerns about the number of ageing Australians, particularly older women, facing homelessness.

The findings come as experts warn Melbourne is approaching crisis point, with extreme consequences forecast if more affordable rentals do not come onto the market.

Want to know how affordable your suburb is? Click here to access an interactive map.

The index, released by SGS Economics and Planning, National Shelter and Community Sector Banking, found the average household in Greater Melbourne spent roughly one quarter of their total income on rent. Housing stress is deemed to be when 30 per cent of income is spent on rent.

The report found families and households on lower incomes were continuing to be pushed to outer fringe suburbs in order to secure a place to live. James Barron from Community Sector Banking said this could have negative flow-on effects.

“If they’re forced out to the outer rings of Melbourne into regional centres, that further compromises their capacity to not only travel and look for work, but to stay close to their family and friends,” Mr Barron said.

“We are facing, as a country, a real crisis point where you have literally hundreds of thousands of Australians no longer able to afford basic rent.”

The National Rental Affordability Scheme — a government-funded program that assists low-income tenants — comes to an end next year, with housing advocates calling on the government to provide assurances that people on low incomes and welfare would be able to access long-term rental accommodation.

Ms Witte said barriers to large-scale investment in build-to-rent housing models were putting the Australian market in a headlock.

Council to Homeless Persons head Jenny Smith said Victoria had been the country’s economic success story recently, citing strong labour market participation.

“However the success has a dark flipside, manifesting in fierce and growing competition for rental properties, with those able to benefit from economic growth crowding out those left behind — with growing homelessness as a consequence.”