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TODAY'S OTHER NEWS

Think tank arrears claim sharply differs from leading agency

A think-tank claims one in eight tenants has fallen behind with rent since the start of the Coronavirus crisis - a far higher figure than one produced by an agency chain.

Last week Belvoir said only five per cent of clients were in arrears as a result of the crisis, but now the Resolution Foundation says it’s 13 per cent.

The foundation’s report, based on a YouGov survey of 6,005 UK adults aged 18 to 65, claims that 20 per cent of private renters have been furloughed or lost their job since the crisis began. 

Some 13 per cent report falling behind on their housing costs.

The foundation says private renters’ bigger struggle to meet their housing costs in part reflects the fact that they face higher costs in the first place – their average pre-crisis housing costs were 32 per cent of their family’s income, compared to 11 per cent among mortgaged homeowners. 

The survey shows they also have less of a financial buffer to fall back on, with 23 per cent of private renters having no savings in the run-up to the crisis, compared to 11 per cent of home owners.

While renters receive more generous benefit support than mortgagors, home owners with a mortgage have been more successful in accessing support outside of the social security system to cope with the crisis claims the foundation.

One-in-seven owners have applied for a mortgage holiday, the vast majority of which have been accepted. In contrast, one-in-10 private renters have asked for a rent reduction from their landlord - around half are said to have been successful.

The foundation claims that 25 per cent of private renters have reduced other spending to cope with meeting their housing costs - in some cases this apparently includes being unable to afford fresh fruit and vegetables. 

“Britain already had a huge housing divide before coronavirus struck, and the current economic crisis has only widened that gap. People living in private rented accommodation have found it harder to meet their housing costs than homeowners in recent months, and harder to negotiate reductions in those costs” says Lindsay Judge, principal research and policy analyst for the foundation.

“The result is that a quarter are cutting back on other spending, in many cases on essentials, to cover their rent during this crisis. Policy makers need to recognise that, while the 1990s recession was infamously most severe for the UK’s home owners, this recession is biting hardest for renters” she claims.

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