‘Unsustainable’ rent hikes threaten Housing Benefit reforms
By Vivienne Russell | 22 October 2012
The number of working people claiming Housing Benefit to subsidise their rent has almost doubled in the last three years, according to the National Housing Federation.
The body, which represents social landlords, today warned that an ‘unsustainable’ rise in market rent threatened the government’s goal to reduce the benefit bill.
Both private rental and house prices are forecast to rise even more sharply than they have been over the next three years, with rental costs outpacing house prices, the NHF concluded in its Home truths 2012 report.
Costs of renting in the private sector have risen by 37% over the past five years and are set to increase by another 35% over the next six years, the report said. Almost 418,000 working people are now relying on Housing Benefit to help them meet their rent payments, an 86% increase since 2009.
NHF chief executive David Orr said: ‘We now have millions of families struggling to keep on top of their rents, priced out of the housing market and nearly 10,000 more working families every month are now reliant on Housing Benefit to help pay their private rent.
‘These people are the “strivers” the government wants to help, yet their future is looking bleak. This cannot continue; we need action now to address the causes of rising housing costs, not just the symptoms. Only by addressing the chronic undersupply of new homes can we stem the financial pressure on families and government.’
The federation is calling on the government together with the whole housing industry to take a long-term and joined-up look at what can be done to address market difficulties.
In the short term, the government should release more publicly owned brownfield land to housing associations so they can build more houses. Land equivalent to twice the size of Leicester and ready to be built on now has been identified by the NHF.
‘Successive governments have failed to tackle the under-supply of housing and time is now running out,’ said Orr.
‘If we don’t urgently fix the housing market we will have a generation who are priced out of renting a home, let alone buying one.’