More than a third of furloughed private renters are worried about being able to pay their rent when the coronavirus lockdown ends, according to new research published today by the Joseph Rowntree Foundation, a think tank.
The federation says this means around 250,000 people in this group could be in a position where they struggle to meet their housing costs when the lockdown ends.
The research, based on a sample of 1,031 private renters in a YouGov survey of 6,430 UK adults, demonstrates what the federation calls “the precarious situation faced by many households who are renting privately.”
The government recently temporarily increased the amount of support private renters can get for their housing costs, known as Local Housing Allowance up to the cheapest 30 per cent of local market rents.
The JRF says this was a step in the right direction, but for many it still leaves a big gap between the support available and the real cost of renting, especially in areas with high rents where an overall cap prevents households from getting the support they need to meet their housing costs.
As examples, it cites that renters in a two-bedroom property who were eligible for all their rent to be covered would see a gap of around £150 a month in Brighton, £100 a month in central Manchester, York and Cambridge and around £80 a month in Liverpool.
In some Central London boroughs, this gap would be £1,715 a month, the federation claims.
JRF is calling for an increase in LHA to cover median rents in all areas, as well as the removal of the national cap on the amount of LHA that can be paid, so that it does not limit support in high-cost areas.
The temporary ban on evictions introduced by government is currently in place until the end of June, and there are fears of a surge in eviction proceedings if it is not extended, as large numbers of tenants will no longer be able to afford their rent.
“This could unravel the considerable progress the government has made by housing thousands of homeless people, as high housing costs are a significant driver of homelessness” claims a federation statement.
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I bet many homeowners are worried about their mortgages also .. but that’s not headline news if it doesn’t affect tenants
If tenants CHOOSE to live in expensive areas then it will be obvious that within the OBC they will not have so much spending money as housing costs will consume more of their other benefits.
The answer is to MOVE to cheaper areas or heaven forbid do at least 16 hrs of work pw to avoid the OBC.
Now I know the mere idea of any form of work for your average welfare scrounger is an anathema but come on 16 hrs work pw to reside in expensive areas is not a bad deal!
I'm surprised that welfare scroungers are not seeking to move out of expensive cities due to this CV19 thing.
These scroungers could have a better quality of life in far safer surroundings and they would have more disposable income as their housing costs will be far less so highly unlikely to exceed the OBC.
Sensible people during the "lockdown" period have very little to spend their money on so should now be better - not worse - off than before it started PROVIDED they were employed and either had "furloughed" income or were able to work from home (as most of our tenants have been - all "professionals") on full pay.
Apparently some (probably many) have been bored and done vast amounts of online shopping to pass the time, thus running up large bills on their credit cards that they'll pay off in preference to paying the rent they are "worrying about". That makes sense because the interest rates on their credit cards as typically 32% and with charges for chasing letters and debt recovery on top.
Contrast that with the pitiful plight of landlords who - under the genius and thoroughly well thought out (not) "Tenant Fees Act 2019"... LLs can only charge 3% and apparently have no remaining rights to charge for the costs of debt collection or recovery.
From a tenant's point of view its become a no-brainer - prioritise all other debts about the boring need to pay now optional/voluntary rent, or just live there rent-free for a few months then run away to cheat another landlord, leaving no clues or trace for the previous one to follow.
Others apparently passed some of the time making babies - there will undoubtedly be a bit a a "baby boom" after this, in about 9 months time, so those ones might be worrying about how they'll pay the rent for the BIGGER flat they'll need, on top of all other normal "baby expenses" and compromises!
Of course there was also a big rise in domestic violence (probably un-policed due to the "social distancing" recommendations - not enforced laws), and of course a small boom in domestic murders - very nasty but at least the "baby boom" will be much bigger so in years to come there will be even more demand for PRS housing, except by then the remaining vestiges of the PRS will be totally gone!!!!
Hmm!
I predict there will be 1/2 a million fewer LL in 10 years time.
Those remaining will have fewer properties and the larger percentage of them will be unmortgaged.
This will of course mean a massive shortfall in available rental properties.
I predict being able to source a LL prepared to take you on as a tenant will be as rare as hens teeth!!
Mind you I believe that there will vestiges of many things.
The economy and life in general will become considerably vestigial!!
We have another 10 years far worse than the past 10 years to go through.
Can you imagine what Govt will do to the PRS in the next 10 years!?
I predict
Total S24
Rent controls
Eviction controls
Increased CGT
Increased SDLT
surcharges
Increased EPC and electrical works
100% LL licencing
Restriction on anything other than plain vanilla letting
FHL tax advantages abolished
Requirement to accept DSS tenants with them becoming a 'protected characteristic'
Refusal to abolish 'clawback' for UC direct payment.
HMO licensing for any property not occupied by a single household
There will be many other things I haven't thought of.
But the lot I have listed will keep the Govt going on their LL eradication policies for the next 10 years.
I hope to have self-eradicated in 4 years!!
Will be in a lot less than 10 years Paul.
Hmm!
I suppose it depends on how populist Boris wishes to be.
If he's after winning the next GE then all I have listed will as you suggest be in and probably more before the Polling Stns open!!!
Got to keep GR ; Shelter etc appeased!!
I think I'm becoming a bit paranoid.
I keep thinking they're out to get me!
I might be correct!!!
Paul, if you are a landlord you should not think that they are out to get you. You should KNOW they are out to get you.
Yep but I'm a bit thick and it takes me some time realise what is going on.
All rather insidious!!
Clever people like you are well ahead of thickies like me knowing what is actually going on!
I get there in the end; probably too late mind you but as they say better late than never!
@Paul Don't do yourself down Paul. I think many landlords will realise eventually that this Government is out to get them and will sell up.
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