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Rent arrears and threat of homelessness on the rise as economic growth fails to reach social tenants

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rent arrears and threat of homelessness on the rise as economic growth fails to reach social tenants

Despite growing confidence in the UK’s economic recovery, social housing rent arrears cases reported to Citizens Advice from July to September this year increased by 13 per cent since the same period last year.

National charity Citizens Advice warns that the rise in social housing rent arrears and threatened homelessness demonstrates that households are not yet feeling the benefit of the improved economic outlook.

In the second quarter of this year, Citizens Advice Bureaux gave advice on:

  • 22,412 issues about social housing rent arrears – a 13 per cent increase on the same period last year;
  • 2,840 issues about possessions claims due to rent arrears in the social housing sector – a 38 per cent increase on the same period last year;
  • 2,736 issues about threatened homelessness in social housing – a 12 per cent increase on the same period last year;
  • 3,307 issues about Discretionary Housing Payments – a 110 per cent increase on the same period last year.

The charity suggests that the impact of the Under-Occupancy Penalty, combined with changes to Council Tax support, has contributed heavily to rent arrears problems. Instances of Citizens Advice Bureaux advising clients about Discretionary Housing Payments, to help people pay their rent, have more than doubled in the six months since April this year when the charge for under-occupancy was introduced.

Citizens Advice Chief Executive, Gillian Guy, said:

“We are on the edge of a serious housing crisis. There are simply not enough homes to meet need and the result is yet more pressure on household budgets.

“Despite the good news, the economic warning lights are still flashing.  The emerging trend of increasing social housing arrears is extremely worrying.  Cases of arrears are up across every region of England, with the Midlands and parts of the North showing the starkest deterioration.  Prices which far outstrip incomes and the damaging impact of high food and energy bills make paying rent simply impossible for many people.

“The impact of welfare reform is crucial.  Done right, reforms such as Universal Credit could simplify support and incentivise work. However what we’ve seen in recent months is what can happen if reforms are rushed in without proper safety net in place.

“The debate over our state safety net must move away from the idea that it is entirely about money. Direct financial support is essential in helping people meet day-to-day costs, but the long-term importance of getting infrastructure right, particularly housing, cannot be ignored.”

New data published today by the national charity show an increase in advice given about social housing rent arrears in every English region. The North East and West Midlands are the worst hit English regions per head of  population and the steepest year-on-year rises were in the East Midlands and Yorkshire and the Humber.

Of all the charity’s clients advised about debt issues:

  • 45 per cent are social tenants;
  • 31 per cent are private tenants;
  • 20 per cent are buying their home;
  • 5 per cent own their home outright.

Source:  Citizens Advice Press Office

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