A new report on the affordability of renting a shared home on benefits in London reveals:
Last year, the Government made a change to the Shared Accommodation Rate (SAR) – the level of Housing Benefit that applies to single people in the private rented sector – that placed restrictions on claimants under the age of 35. Homeless Link’s report, Nowhere To Move, examined data taken from 55,537 property listings in London to assess the impact of this change.
Launched today at Homeless Link’s national conference on housing 'Finding and keeping a home, it revealed that just 5.5% of properties in the capital are actually affordable to claimants. The findings strongly suggest that welfare reform is adding to an already severe housing crisis in London.
The SAR is limited to a maximum amount based on what is seen as appropriate rent for a room in a shared property. Until January 2012, this only applied to 18-24 year olds but was extended to include all benefit claimants under 35. According to the Government’s own figures this added a further 12,000 people to those already competing for shared accommodation.
Government sets housing allowance limits so that 30% of properties in an area are affordable to those who claim it. However, the report reveals that the actual figure in London is much lower – just 5.5%. The allowance hasn’t increased in-line with the significant rises in private rental prices, pushing more and more properties out of reach.
The report also suggests that the attitudes of private sector landlords could be putting benefit claimants at a severe disadvantage. From our sample of properties, less than 1% had landlords that explicitly stated they were happy to rent to benefit claimants.
All of these findings present a situation in which changes to the welfare system could be further limiting access to affordable accommodation for people under 35. The report suggests a number of recommendations in order to avoid potentially forcing people into homelessness. Primarily, housing benefit rates should be adjusted to reflect the real cost of renting shared accommodation in London and ensure that claimants have access to at least 30% of properties in their local area.
Rick Henderson, Homeless Link’s Chief Executive, said:
“Housing Benefit is intended as a safety net to protect the most vulnerable and ensure they live in safe, secure conditions. This report clearly shows that the recent changes to the system have left it falling far below the mark and could be putting many people at risk of homelessness.
“The bottom line is that the housing crisis must be fixed and the dysfunctionality of the housing market needs to be addressed. In the short-term, Government must make in-roads by ensuring that more properties are affordable and encouraging landlords to open their doors to those on benefits.”
Howard Sinclair, Chief Executive of Broadway, said:
“We are already seeing evidence at Broadway of the negative effects of the Housing Benefit changes. People are losing their homes and those looking for accommodation from the streets are finding the move on from temporary accommodation increasingly difficult. We can only see the situation getting worse unless urgent action is taken to make properties more affordable for those on benefits.”
When the changes to SAR came into effect, Ash was unemployed and receiving Job Seekers Allowance. Under the new guidelines, Ash’s Housing Benefit decreased by £81 per week, leaving him with a shortfall of £350 per month.
Ash contacted his Local Authority for help and began attending group property searching events, one to one advice sessions and all suitable property viewings. Despite this, Ash struggled to find a home due to a lack of availability and refusal by landlords to accept him as a tenant.
In total it took Ash four months to find somewhere suitable to live, at which point the Local Authority was able to offer a financial incentive to a landlord.