Rising rents and benefits cuts pushing vulnerable tenants out of private housing market in SW

The UK’s most vulnerable tenants are being pushed out of the private rental market in the South West, according to the latest Royal Institution of Chartered Surveyors (RICS) Residential Market Survey.

New figures show that around one-third of respondents believe that access to private rented properties had fallen among people on housing benefits.

Recent caps to housing benefits were cited by 29% cent of respondents across the UK as a key reason why those on lower incomes were being pushed out of the rental market.

Those on lower incomes are set to face further financial difficulties with rents expected by respondents to the survey to increase by in excess of 4.2% the next five years. By way of contrast, house prices are projected to increase by around 3.3% over the same period in the region.
However, the Government may be able to provide assistance, as respondents to the survey in the South West suggested that more than half of the regions private landlords would be prepared to rent their properties to homeless people or those on housing benefits if the Government introduced some form of state-endorsed deposit guarantor scheme.

52% of those surveyed nationally said that they would consider letting properties to households in receipt of housing benefit and/or homeless households if help was provided through central government which provided financial guarantees for both deposits and rent, and ongoing support for both parties.

The survey also showed that across the country the shortage of available properties to rent is continuing to grow, with tenant demand consistently exceeding the number of new instructions coming to market over the past four years in the South West.
As part of their ‘A Home For Cathy’ campaign – aimed at tackling UK homelessness – RICS is joining forces with Crisis to call on Government to do more to support vulnerable tenants through the introduction of help to rent measures.

RICS CEO, Sean Tompkins said:

“We see this as a matter of public interest. The housing market is falling increasingly out of step with the majority of household incomes. In the current climate, it can be hard enough for young professionals to make ends meet. But for those on benefits, the pressures may be insurmountable. Worryingly our figures show that as a result of a combination of economic pressures, more and more vulnerable tenants are being pushed out of the private rented sector. However, if Government were to put in place additional support measures through the introduction of help to rent schemes, the door to the rental market may once again be opened for Britain’s most vulnerable.”

Jon Sparkes, Crisis Chief Executive, commented:

“This survey highlights the uphill battle many homeless people face when trying to enter the private rented sector. Renting is often the only way out of homelessness, but the vast majority of landlords now consider it too risky to rent to homeless people. This is a desperate situation to be in: to be ready to move on and start rebuilding your life only to encounter financial barriers and closed doors.

“With growing numbers of people stuck in this homelessness trap, we need to find ways to reassure landlords whilst supporting homeless people to find a place to live. That’s why Crisis’ Home: No Less Will Do campaign is calling on the Government to underwrite a national rent deposit guarantee to ensure more support is made available to those trying to find a home to rent. They already help first-time buyers struggling for a deposit - we’d like to see them extend this help to those who need it most.”

Respondents indicated that modest growth was continuing across the housing market, with 16% saying that they had seen a rise rather than a fall in prices over the past three months in the South West. The North West was seen to have performed particularly well with a net balance of 43% cent reporting rising prices