Relying on benefits to pay rent will put UK on course for rent capping?

Relying on benefits to pay rent will put UK on course for rent capping?

A recent study has found that the number of households in Britain is growing three times as fast as the number of homes being built; whereby workers are increasingly depending on benefits to pay their rent, with an extra 10,000 workers a month becoming reliant on housing benefit.

The Home Truths study, by the National Housing Federation, found that in May 2012 there were 903,440 working recipients on housing benefits – more than double the figure for November 2008, which was 485,610.

The NHF attribute this 86% rise, over just 3 years, to:

  • failure to build enough new homes
    (390,000 new families were formed in 2011, only 111,250 new homes were built.)
  • soaring rents
  • house prices.

NHF chief executive David Orr said the housing market was “at the point of no return“.

These people are the strivers the government wants to help, yet their future is looking bleak,” he said.

Only by addressing the chronic under-supply of new homes can we stem the financial pressure on families and government.”

The study warns that, by the next election, 1.2 million “strivers” will only be able to stay in their homes through welfare payments.

Representing 1,200 Housing Associations in England, the NHF said that the cost of renting a home had risen by 37% in the past 5 years and was expected to rise by a further 35% over the next six years.

And while it expected modest falls in house prices into 2013, it predicted price rises of 6 % a year across England from 2015 to 2017.

Therefore the NHF has called on the government “and the whole housing industry to take a long-term, joined-up approach to tackle the market difficulties“.

More immediately the government must release publicly-owned brownfield land to housing associations so they can build more houses,” it said in its report.

It said it had used the government’s own data to identify “land equivalent to twice the size of Leicester that could be built on“.

This brings Landlord Referencing back to a question that we asked in July 2012;

How will the government bridge the gap between an improving economy and rising rents
a lack of housing stock and capped benefits? ? ?

Data gathering puts UK on course for national rent cap.

Welsh rents could be regulated using little known legal powers … …

Furthermore, LRS’ latest Tenant Alert statistics reveal that the amount of accumulated rent defaults and property damages recorded in September 2012 have more than doubled compared to August 2012; with an increase of £20,250 each week!

Dramatic rise in Tenant Alerts following the introduction of Universal Credit pilot scheme.

As well as championing Credit Unions, who are able to offer great solutions to rent arrears and evictions (especially with the impending welfare reform via Universal Credit) this is a prime example as to why every landlord and letting agent right across the country should join our completely free referencing system.


  • Are you finding it hard to make ends meet?
  • What should be done to improve the supply of affordable housing?
  • What do you think about a national rent cap?

Please leave us your comments and experiences below.

Author: News @ Tenant Referencing

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