Private renting 'unaffordable for families on low wages in 67% of England'

By agency reporter
July 13, 2019

In two-thirds of the country, working families on low wages could not afford to privately rent a typical home without turning to housing benefit, new research from Shelter shows.  

The housing charity analysed average private rents for two-bedroom homes in every local council area in England to assess whether they would be affordable to working families in lower paid jobs - with one adult working full-time and another part-time. There are approximately 1.5 million working families living in privately rented homes.

The findings reveal that – excluding housing benefit – there are 218 council areas where local families earning a low wage would be forced to spend more than 30 per cent of their salary on rent. In 112 of these (35 per cent of areas) this rises to more than 40 per cent.  

Further exposing the depths of England’s ‘rent trap’, Shelter mapped the hotspots where private renting is the least affordable. Kensington and Chelsea topped the list with the average rent in the borough equivalent to 127 per cent of a low earning family’s take-home pay. This is closely followed by Westminster at 111 per cent and Camden where rents swallow 92 per cent of pay.

However, it is not only the capital where the picture is bleak. In Cambridge, a family would have to spend 61 per cent of their wages on an average rent, versus 57 per cent in Oxford and 50 per cent in Bristol - and that is before paying for any other essential costs like childcare, food or utility bills.

Additional analysis of rent costs for families with only one full-time worker on a low wage proved even worse. In 320 areas (98 per cent of the country), those living off one income would be forced to spend more than 30 per cent of their pay on rent. In 228 of these (70 per cent of areas) this rises to more than 40 per cent.

The charity argues that if the government invested in a new generation of social homes, working families would not need to rely on a faulty housing benefit system to keep a roof over their heads. To demonstrate this, it carried out a comparable analysis of social rents.

In contrast to private renting, social rents were found to be affordable for working families on low wages in 100 per cent of the country. The maximum a family with one full and one part-time worker would have to spend on social rent is 26 per cent in Hertsmere, versus just 13 per cent in Hastings.  

With the latest government figures showing almost £8 billion was paid out in housing benefit to private landlords in 2017/18, Shelter is calling on the next Prime Minister to deliver 3.1 million social homes over twenty years as a more sustainable solution to the housing crisis.

Polly Neate, chief executive of Shelter, said: “Families in lower-paid jobs are having their bank balances bled dry by expensive private rents across huge swathes of the country.

“The steep decline in social housing has left a growing number of families caught in a debilitating ‘rent-trap’. It’s disgraceful that despite working every hour they can, many parents are now forced to rely on housing benefit to keep a roof over their children’s heads.

“It makes no sense to continue haemorrhaging billions of pounds in housing benefit to private landlords, when the government could support families by investing in a sustainable, long-term solution to the housing emergency instead.

“The next Prime Minister, whoever that may be, needs to realise social housing is the best cure to the affordability crisis we face. The delivery of 3.1 million new social homes over the next twenty years is the only way to lift millions out of housing poverty and into a stable home.”

* Shelter


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