A third of Britain is off limits to low-income renters

15 July 2013

Lower-income working families can't afford to rent a home in a third of Britain, research reveals.

A report from the Resolution Foundation, which campaigns for those on low to middle incomes, defines affordable as rent that which is no more than 35% of net household income.

As such, 125 of 376 local authorities (33%) are unaffordable for a couple with a child requiring a two-bedroom property on a household income of £22,000 a year – the example family used in the report.

"The private rented sector is now, in large parts of the country, the most expensive form of housing," says Vidhya Alakeson, deputy chief executive of the Resolution Foundation.

"It is also the only option for most low to middle-income households, many of whom are faced with the unenviable choice of forgoing other essentials in order to pay for housing or living in overcrowded conditions to reduce their housing costs."

But housing minister Mark Prisk said the report was "alarmist" and pointed out that rents have been falling in real terms. He also said it failed to take into account the fact that "housing benefit provides a safety net which ensures that up to a third of private properties in most areas are affordable to low income families".

Kate Faulkner, property expert and managing director of Designs on Property, told Moneywise: "Most cities [outside London and the south east] will rent properties for an average of £500 a month, which between two people isn't too bad, but while we have an increased number of people trying to rent on their own due to marrying later or divorce, this can be tougher to afford."

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She also said there is a lot of mis-information on rents. "The reality is according to both the Office for National Statistics and the Belvoir Lettings Index, rents are pretty much the same as they were in 2008 – they have hardly changed. Those seeing rents rising are ones who have entered the market since the falls seen in 2009, but overtime, rents have reduced or stayed the same, pretty much in line with disposable income."

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