1 In 3 Renters Are Getting Into Debt To Pay Their Rent
The Debrief: Loans, credit cards and borrowing from family members: Shelter finds that renters are getting into debt just to cover housing costs
Labour’s leaked draft manifesto is still dominating the news, despite the party’s best efforts to change the conversation by saying that under a Labour government there would be ‘no more hand holding with Trump’ earlier this morning. The manifesto has now been approved by those in charge at Labour HQ, so it’s expected to remain as it is when it’s officially announced next week.
There’s a lot of chatter about whether Corbyn’s manifesto is a step back in time to the 1970s or a progressive step forwards. It talks about reversing the privatisation of the NHS, increasing corporation tax, creating a Ministry of Labour to protect workers’ rights, re-nationalising the energy industry and the railways. It also proposes to ban unpaid internships and scrap tuition fees.
On housing in particular, there were some interesting points. Struggling renters have been ignored by successive governments for too long and despite the success of The Debrief’s Make Renting Fair Campaign, which saw the last Conservative government announce a ban on letting fees for tenants, there’s still more to be done.
It's fitting that housing is on the agenda this election. Today Shelter has released new research which finds that as many as 1 in 3 renters are having to borrow money to pay their rent. That’s as many as half a million people who are using credit cards, loans or borrowing from friends and family just to cover their housing costs. Shelter is calling on the next government to build half a million homes which can be let out at a living rent, one that’s actually affordable, over the next five years.
With this in mind, it’s fitting that there was a focus on housing in Labour’s draft manifesto. For renters specifically, it proposes rent increases capped at inflation. This would mean that rents could not rise in the way exorbitant they have over the last few decades. Secure three-year tenancies are also included, but it's worth noting that this is something Shelter and Lib Dem peer Baroness Olly Grender have been fighting for as part of the Renters’ Rights Bill.
Shelter’s survey found that of the almost 1.6 million renters fall into the ‘low-earner’ category. One in three of them – around 511,000 – had borrowed money during the past year to keep on top of their rent.
Labour’s proposal to cap rent rises at inflation is a good one, but with rents already so high as they stand more needs to be done to make housing affordable. Rent swallows up the majority of many people’s income. Shelter also found that around 800,000 tenants were on such tight budgets that they could not afford to save even £10 a month.
Labour’s draft manifesto also pledges the biggest social house-building programme in a generation, with 100,000 council and housing association properties built every year. This would take the pressure of the private rental sector which is currently bridging the gap for both a social housing shortage and those who cannot afford to buy.
Have you ever got into debt to pay your rent? Let Vicky know on Twitter @Victoria_Spratt
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