UK rent 'unaffordable' for too many low-income families

Jul 15, 2013
Anna McKie

A new report claims 33% of Britain is effectively off- limits to poorer families because of high rents

AS RENTS continue to rise and incomes stagnate, private rental accommodation in a third of Britain is now unaffordable for low-income families.

The Home Truths report, carried out by the think-tank Resolution Foundation, found that even a very modest rental home is out of reach in 33 per cent of all local authority areas for Britain's 1.3 million low-income families.

The report highlighted the recent increase in demand for private renting, as many families are unable to afford a deposit to buy a home but are not vulnerable enough to qualify for council housing.

According to the report, in 125 of the 376 local authorities in Britain, a couple with a net income of £22,000 a year and one child would have to spend more than 35 per cent of their income to rent the least expensive two-bedroom property. According to the Financial Times, rent that is over 35 per cent of a family's earnings is considered "unaffordable".

In 38 of the 376 local authorities, rent would take up more than half of their annual net income.

The report said that the gap between supply and demand for housing is creating "affordability black spots" across the country for ordinary families. The problem is particularly acute in Britain's most expensive housing markets of London and the Southeast, but is also found in areas ranging from Exeter to Aberdeen.

Vidhya Alakeson, the report's co-author, said in light of the findings the government needs to prioritise increasing the supply of housing for rent.

"People should not have to choose between decent, affordable housing and other essentials in life such as clothing, food or furniture," she said. "Yet that is increasingly what is happening as housing costs escalate."

However, housing minister Mark Prisk called the report "factually flawed", saying that it ignored government initiatives such as the £1bn Build to Rent fund and £10bn in loan guarantees to build new homes specifically for private rent.

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"A new report claims 33% of Britain is effectively off- limits to poorer families because of high rents"

High rents are NOT the fundamental issue, they reflect a lack of housing. It is a supply issue. Lowering rents, if it were possible, would not solve the problem of a shortage of housing. More houses (or less people) in high rent areas would lower rents.