The cost-of-living crisis is combining with Britain’s existing housing crisis to create a perfect storm for the poorest sections of the working class. In August, dozens of housing charities warned that soaring rents and vastly increased energy bills were creating a homelessness ‘precipice’. The chronic lack of social housing is driving more and more people into the private sector, where rents are at an all-time high – if you can find anywhere to live at all. The social housing rent cap being mulled by the new government will do nothing to resolve these issues – nor help the poorest people keep damp and substandard homes warm and dry this winter.
Evictions rise as rents go through the roof
Citizens Advice has called homelessness ‘a time bomb waiting to go off … six to 12 months from now, homelessness is going to go “whoosh”’ (Financial Times 24 August 2022). 66,000 more people in England are expected to become homeless by 2024. One of the leading causes of people losing their homes is Section 21 ‘no fault’ evictions. In theory, these will be banned by a long-promised Renters Reform Bill under the current parliament, but with 18% of MPs, including a quarter of the new Truss Cabinet, themselves private landlords, it is more than conceivable that the measure, first promised under the Theresa May government of 2016, will once again be deferred.
The fall-out from the Covid-19 pandemic has been brutal, particularly the ending in September 2021 of the moratorium on evictions. This saw an immediate 42% rise in possession orders in October and November of that year. In addition, the most recent government statistics (for the first quarter of 2022) show:
- Social housing evictions for rent arrears up 117.2% for January to March 2022, compared to the same period in 2021; for supported housing the figure is 65.4%.
- The number of homeless households, or those threatened with homelessness who are owed a statutory housing duty by councils at 74,230 in the first quarter of 2022 – up 5.4% on the same period in 2021. 62% of these include children, with the result that by the end of March 119,840 children were living in temporary accommodation; 1,700 such families were housed in completely unsuitable B&Bs.
- Section 21 ‘no fault’ evictions are up 141.5% on same quarter of 2021. Approximately 6,400 households in England were handed Section 21 eviction notices between January and March 2022, the highest number since records began in 2018.
Meanwhile rents in the private sector are growing at their fastest rate since 2016 and are increasingly unpayable for growing numbers of working class people. Average private rents are up more than 10% over the last 12 months; figures from the Office of National Statistics show that monthly median rent between April 2021 and March 2022 was £795, the highest ever recorded; in London the figure was £1,450. The impact on the poor, and particularly on young people, has been disproportionate, with many in cities such as London, where demand far outstrips supply, paying an average of 40% of their income in rent. The London rental sector is rife with lurid tales of unscrupulous landlords encouraging prospective tenants to outbid each other, sometimes for hundreds of pounds a month more than the asking rent.
For those on benefits, Local Housing Allowance (LHA) covers only 30% of market rents, and has been frozen since April 2021. Research by the housing charity Crisis in March 2022 showed that the poorest families were already facing a monthly deficit of £373 between LHA and the cheapest rents in their areas.
Social housing rent cap
This is why the government’s proposal to cap rises in social rent at about 5% will have only limited benefits for those who need it most. Social rent is normally between 40%-60% of market rent, averaging in 2021 between £77.67 a week in the northeast of England and £114.44 in London. However, while about three quarters of social housing stock is still set at this ‘social rent’, most new housing association provision now consists of misleadingly-named ‘affordable’ housing, at up to 80% of market rent. These homes would not be covered by the cap.
Social sector landlords – local authorities and housing associations – are allowed to raise rents each year by September’s Consumer Price Index rate plus 1%. With inflation soaring, social tenants were looking at rent rises of more than 11% in the coming year – on top of 4.1% last April. For the approximately two million households not in receipt of housing benefit, any rent cap will bring some relief, as it will to those who face a large gap between benefits and rent because of the Bedroom Tax or Overall Benefit Cap.
However, housing benefit would still fully cover rent for about 56% of social tenants. So while the cap would leave social landlords facing a shortfall of £2.8bn – with a devastating impact on repairs, maintenance and the building of new homes – it would save £4.6bn on the state’s benefits bill. It is in effect another massive cut in central funding to social housing.
Cold homes cause death and disease
More than a quarter of all renters, overwhelmingly the poorest families, live in substandard, badly insulated homes vulnerable to cold, damp and mould. Medical experts have warned that if rising fuel bills make it impossible for such households to heat their homes adequately, the impact on children’s health and development will be devastating. Michael Marmot, the director of the UCL Institute for Health Equality, called it a ‘humanitarian crisis’, pointing out that housing quality is a component of fuel poverty, and that children growing up in cold homes have more respiratory diseases that feed through into adulthood, more mental health damage, worse development and more days off school. The President of the British Paediatric Respiratory Society, Dr Simon Langton Hewer told The Guardian in September: ‘There will be excess deaths among some children when families are forced into not being able to heat their homes’.
A cap on all rents, particularly in the private sector, is urgently needed to alleviate the impact of the cost-of-living crisis in the immediate term. But it cannot be more than a temporary solution to a far wider housing crisis. That can only be resolved by the provision of socially owned housing on a mass scale – housing that is affordable, secure, warm and dry. None of the political parties are going to provide it. We have to fight for it.
Cat Wiener
FIGHT RACISM! FIGHT IMPERIALISM! 290 October/November 2022
