The rising cost of high rents (it’s not all financial)
“The rising cost of high rents is damaging household finances but also health, security, family life and the economy. With the cost-of-living crisis stretching pockets, high rents going even higher can be the final straw. ”
Anna Tickle is a Research & Campaigns Volunteer at Citizens Advice Epsom & Ewell. (4 minute read)
Official statistics record annual private rents rising 5.5% in the year to August with the South East rising by 5.3%.
Rising rents mean many people just can’t find affordable housing. Others, lucky or desperate enough to win the race* find they can’t afford the payments. With the cost-of-living crisis stretching pockets, high rents going even higher can be the final straw.
Surge in demand
The UK is facing a surge in demand for rental properties. Hamptons, an estate agent, says 3m more households are now renting than in the late 1980s. This increased demand, together with landlords facing big mortgage rate rises, is forcing up prices at record speed.
And landlords are selling up. Hamptons notes the numbers entering the business since 2016 are 25% below the previous average. Despite putting up rents, many landlords still find themselves in a worse financial position than just 2 years ago.
The growing supply/demand gap has made renting more competitive than ever. An unhappy situation that shows no sign of improving any time soon. Hamptons predicts rents will rise 25% between 2023 and 2026 most rapidly between 2023 and 2024.
Epsom and Ewell
At CAEE we’ve been investigating rental properties on offer in the borough. Searching the main property websites we find average monthly rents as follows:
|1 bed = £1,658||3 bed = £2,318|
|2 bed = £1,777||4 bed = £2,962|
Comparing locations for the average cost of a 2 bed rental, property search firm Home.co.uk shows Epsom & Ewell 13.5% cheaper than Surrey as a whole. Nearby areas compare compare with E&E as follows: Cheam 2.6% cheaper, Ashtead 3.4% cheaper, Sutton 2.6% dearer.
It’s not just money
Rapidly rising rents are having a range of effects here and across the country, none of them good:
- More tenants struggling with debt and using credit cards, overdrafts and loans to keep up their payments
- More at risk of homelessness and living in temporary accommodation creating insecurity strain on family life and health
- More cutting spending on essentials, such as food and energy, putting their health at risk
- More unable or unwilling to spend on non-essentials, such as the gym, affecting local business and the economy
- More young people choosing having to live at home with parents while they save and/or study.
Improve private renting
It will take years to end the housing supply crisis and properly improve life for tenants. In the meantime Citizens Advice is calling on government to urgently improve private renting by:
- enacting the Renters (Reform) Bill without further delay
- unfreezing housing benefit in the form of the local housing allowance and universal credit housing element.
Rental (Reform) Bill
The bill aims to transform private renting and deliver government’s commitment to ‘a better deal for renters’. One key measure it proposes is to abolish ‘no fault evictions’. This would provide more security to tenants and enable them to challenge poor practices and unfair rent increases without fear of eviction.
The Bill is currently at its second reading in the House of Commons where MPs can debate and make changes before they decide whether to pass it into law. We believe this Bill is a step in the right direction for strengthening renters’ rights and establishing a fairer system. However changes are necessary to ensure no backdoor to ‘no fault’ evictions.
Local housing allowance
In July we reported on the debate about housing benefit. The level of support offered by the LHA is massively out of touch with the actual housing market. As a result, people cannot find affordable housing, and cannot afford to pay their rent.
Get full advice about renting from a private landlord if you have an
assured shorthold tenancy. Most people have this type of tenancy.
* Zoopla. Renting a home: 7 ways to beat the competition and win the race to rent a home.