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Rising rent is “a headwind” battering poor tenants, says think tank

Higher housing costs - including private sector rents - have reduced incomes and increased inequality as the poorest families have borne the brunt of Britain’s 40-year housing crisis, according to a think tank, the Resolution Foundation.

In a research document called Inequality Street, it says that public concern over housing is on the rise: approaching one-in-five adults now believe it’s one of the most important issues facing Britain, up from one-in-20 back in 2001. 

The foundation says housing crisis is really three crises: low home ownership, high housing costs and what it calls “a particularly acute disaster for low-income families.”


The think tank finds that home ownership among young families led by adults aged 25 to 34 has (despite a recent rise) almost halved since its 1989 peak – from 50 per cent to 28 per cent. 

“High house prices relative to family incomes mean it will remain harder for young families to save a deposit large enough to get on the housing ladder” claims the foundation.

It says that back in 1980, the average family spent just 10p of every £1 of income on housing. Today, this has doubled to 20p.

This burden of rising housing costs has fallen more heavily on those families with lower incomes. Back in 1980, the poorest families spent 15p of every £1 of income on housing. Today it has more than doubled to 40p.

The foundation also claims that higher private sector and social rents, and declining support from housing benefit have been “a major living standards headwind” for Britain’s poorest families over the past 15 years, wiping out 90 per cent of all income gains since the early 2000s.

It believes that low-income families have suffered a £1,200 living standards hit from fast-rising housing costs since 2002. 

At the same time, thanks to falling interest rates, high-income families are £400 better off as their housing costs have fallen in real terms since 2002. This means that recent trends in housing costs have acted to push up inequality in the UK.


“As incomes have not risen at anywhere near the same pace as housing costs, families have dedicated a greater share of their income to housing. This burden has landed most heavily on low-income families, particularly in recent years when housing costs have actually fallen for higher income families” says Daniel Tomlinson, research and policy analyst at the Resolution Foundation.

And he adds: “Over the next few weeks, we not only need to see election manifestos promising to address falling home ownership; we also need political parties that are serious about lowering the cost of a roof over your head for lower-income Britain.”

  • Paul Smithson

    Blame shelter :-)

  • S l
    • S l
    • 11 November 2019 09:57 AM

    Blame the government for their inability to think of the consequences of their actions and only about how to fleece the residents off instead of encouraging outside investment to increase income and promote homeownership. Not to forget the current trend where homeownership is really not worthwhile as have to maintain the house which can be very costly and with the job relocation, due to lack of jobs where they live, renting is the solution unless companies are made to pay more for employees to travel or live near work on weekdays and go home on weekend which really are not ideal for family and kids. But then , cant really move the family everytime change jobs, can we

  • Bryan Shields

    I agree with both previous commenents.
    The "People in Power", no longer have connection with the stuff at ground level.
    In other words, a computer print out of numbers are just that - not a/the solution, for these meat heads to justify as an answer.

  • icon

    Interesting that until recently the CEO of this organisation was Campbell Robb, who is a supporter of S24. And as we know if you increase tax it increases the price to the end user.

    What a hypocritical bunch these people are!

  • G romit

    ...this what Shelter, Generation Rent, ACORN. et al have been campaigning for and lobbying Government for the last 10 years or more.
    The increasing regulation demanded and extea taxes just increase the cost of providing properties to rent. Those costs have to be paid out of rents received, meaning increased costs result in higher rents.
    Classic case of be careful what you wish for.
    And still they push for more regulation and higher costs for Landlords e.g. abolition of Sec.21 Notices (errobeously named "no fault" evictions) which will increase eviction costs.


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