Falling savings put millions at risk of repossession

By staff writers
15 Apr 2014

Millions of working families in the UK could not pay their rent or mortgage for more than a month if they lost their job, according to new figures from the housing and homelessness charity Shelter.

A survey of working adults who pay rent or a mortgage found that, with little or no savings to fall back on, 3.8 million families could be just one pay cheque away from losing their home.

Worryingly, the research also found that more than a third of families would not be able to make their next rent or mortgage payment if they were to lose their job this month.

Mirroring Shelter’s research, the latest government figures on savings reveal that 15 million working age adults in the UK have no savings at all and that savers withdrew money from their accounts last year at the fastest rate for nearly four decades.

Shadow Housing Minister Emma Reynolds, said: "These figures demonstrate the cost-of-living crisis facing millions of families up and down the country.

"While this out-of-touch Government tries to claim everything is going well, working people are on average £1,600 a year worse off since the last election and millions of families worry about losing their homes."

One in 400 mortgaged homes was repossessed last year, amouning to 28,900 properties, according to the latest figures from the Council of Mortgage Lenders.

Although repossessions have been falling since the peak of 48,900 in 2009, experts are concerned that the numbers could creep up again as rising costs erode the last of people's savings.

Liz Clare, a Shelter helpline advisor, said: "This research highlights how millions of us now find ourselves living on a financial knife-edge – month to month, pay cheque to pay cheque. Every day we see how just one piece of bad luck, like a sudden job loss or illness, could put the family home at risk.

"Sky-high housing costs and stagnating wages mean most of us don’t have enough money in the bank to rely on for long enough to get back on our feet."

Campbell Robb, Shelter’s chief executive, said: "No matter how hard ordinary families work, in today’s ‘knife-edge nation’ a drop in income can all too quickly put their home at serious risk. If you lose your job finding another one is hard enough, but without a stable place to live it’s almost impossible.

"The government must make sure the safety net is strong enough to stop families falling through the gaps, and going through the nightmare of losing their homes."

[Ekk/4]

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