Across the UK, as many as two thirds of working families who earn low wages were found to be unable to rent a home privately without having to turn to housing benefits to help pay their private rent, according to new research by housing charity Shelter.
To get their results, the charity analysed the average rent for a two-bedroom home in each council area in England. They then compared private rent costs with the combined wages of a typical working family, where one adult was working full-time, and another working part-time.
According to Shelter’s latest findings, the average working family with a low income would need to spend 30 per cent of their income or more (excluding housing benefits) on private rent in at least 218 English council areas.
Their findings come as a number of landlord associations asked prospective Tory leadership candidates to overhaul the Government’s attitude towards the private rented sector (PRS).
With 1.5 million working families reported to be living in privately-rented homes, Shelter warned of the existence of a “rent trap”, whereby low-paid working families are being priced out of many parts of the PRS.
The borough of Kensington and Chelsea was identified by Shelter as the least-affordable area in London, with the average rent in the borough equivalent to 127 per cent of a low-paid family’s average earnings. Other London boroughs showed similarly high rent costs.
In Westminster, rents were estimated to be as much as 111 per cent of a working family’s take-home pay, whereas Camden rents were as much as 92 per cent of their pay. Lack of affordability extended beyond London, with Cambridge rents being found to be 61 per cent of a low-paid working family’s wages.
When Shelter analysed rental costs for families with only one worker receiving income, as much as 30 per cent of a family’s income would go into rent, in as many as 98 per cent of the council areas the charity surveyed.
Calls for greater government action
Shelter used its findings to urge the UK’s next Prime Minister to recognise the gravity of the UK’s housing affordability crisis.
Polly Neate, chief executive of Shelter, said: “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.”
Ms Neate concluded: “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.”