According to research conducted by housing charity Shelter, one-third of working tenants in England are at risk of losing their homes because they lack sufficient savings to cover rent if they become unemployed. The combination of soaring rents and increasing household expenses puts a strain on tenants’ finances, making it difficult for them to set aside emergency funds.
Shelter’s survey of over 2,000 tenants revealed that 55% experienced rent hikes this year, with 37% struggling or falling behind on payments as a result. The charity described tenants’ savings as “drying up,” with 51% of working tenants having only a month or less of rent saved, including 34% who admitted they couldn’t afford any rent from their reserves.
This alarming situation means that 2.2 million adults in England could immediately fall behind on rent if they lost their jobs, and 3.2 million are just one paycheck away from homelessness, as highlighted by Shelter. Over the past two years, the number of renters who can only cover one month’s rent with their savings has risen by almost a third, further emphasizing the urgency of the crisis.
Shelter’s CEO, Polly Neate, expressed deep concern, stressing that private renters are facing an unprecedented crisis. Due to the severe shortage of social homes, people are barely getting by and forced to compete for overly expensive private rentals as they have no other options. With the ongoing surge in food and household bills, thousands of renters live on the edge, with the constant threat of losing their homes and facing homelessness.
Recent official data from the Office for National Statistics (ONS) highlighted a rise in unemployment rates and private rents. The ONS reported that the UK’s jobless rate had reached 4.6%. Additionally, private rents paid by tenants across the country saw a 5.3% increase in the year up to July, the largest annual rise since the series began in 2016, as revealed by the ONS. While the ONS data may indicate a lower growth rate compared to advertisements for rental properties, property website Rightmove’s most recent data showed that listed rents in some cities have risen by over 20%. Outside of London, the average advertised private rent reached a new record of £1,231 per month, nearly doubling to £2,567 in London.
Tenants, like homeowners, not only face rising rents but also grapple with increasing energy bills and inflation affecting the cost of essential groceries.
In response to the situation, a government spokesperson highlighted their successful track record in delivering affordable homes for rent and purchase throughout the country. They cited the delivery of over 659,500 affordable homes since 2010, including 166,300 homes for social rent through the £11.5 billion affordable homes program. The spokesperson also pointed out that the government’s renters (reform) bill aims to provide tenants with greater security in their homes and prevent excessive rent increases from being used as a means of eviction.
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