22/10/2012

Escalation In Working Families Relying On Housing Benefit

Since the recession began in 2008 the number of working households relying on housing benefit has doubled, according to a new report.

The Home Truths study by the National Housing Federation found that in May 2012 there were 903,440 working recipients of housing benefits – more than double the figure for November 2008 and a jump that signifies an alarming rise in in-work poverty.

As private rents rise faster than wages, another 10,000 working people a month need housing benefit to afford their rent. By the next election, the study warns, 1.2 million "strivers" will only be able to stay in their homes through welfare payments.

The federation's analysis is that housing is becoming unaffordable as supply is outpaced by demand. The number of households in Britain is growing three times as fast as the number of homes being built.

David Orr, chief executive of the federation, said: "We now have millions of families struggling to keep on top of their rents, priced out of the housing market, and nearly 10,000 more working families every month are now reliant on housing benefit to help pay their private rent. These people are the strivers the government wants to help, yet their future is looking bleak."

The report predicts that in England by 2018 the average weekly rent will be £245, up from today's £181, a leap of 35%. The lingering recession means house prices will fall next year but then rise sharply. By 2018 homes in England will cost on average £292,060, almost £60,000 more than today.

(H/CD)

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