A large-scale survey of private and social renters in Great Britain reveals:
- Around 2.5 million households are worried about paying their rent over the winter and 700,000 are already in arrears with their rent payments
- JRF estimates that arrears could already total £400m in England & Wales
- 350,000 households have already either been served an eviction notice or been spoken to about eviction by their landlord
- High proportions of renters who’ve reduced spending to offset a fall in income since March are cutting back on essentials like food (70%), heating and electricity (49%), and for renters with children, food for children and nappies (39%)
- JRF is calling for a watertight ban on evictions, together with targeted support for rent arrears to prevent a surge of evictions in the spring
Protections put in place at the start of the pandemic are not working for large numbers of renters. Renters on lower incomes are being hit hardest, and many are using up their limited savings, cutting back on essentials and borrowing money to stay afloat.
Despite this, many households are building up unmanageable amounts of rent arrears, and some are being threatened with eviction. Black, Asian and minority ethnic renters are disproportionately likely to be concerned about paying their rent over the winter.
The Joseph Rowntree Foundation (JRF) is warning that without immediate targeted support, renters who have seen their incomes drop will be at risk of real hardship this winter and may lose their homes.
JRF is urging the Government to reinstate a watertight eviction ban to prevent a wave of homelessness this winter. Despite government guidance not to employ the use of bailiffs before 11 January in England, this protection may not be legally binding and may not be well understood by households vulnerable to eviction, who may feel they have no option but to leave their home if they receive an eviction notice. The Government is also considering excluding people with arrears from prior to Covid-19, a highly financially vulnerable group.
JRF recommends a targeted grant programme designed to address rent arrears, along with guidance for councils to make sure the support reaches people who need it most and that any temporary protection from eviction does not simply delay problems until the spring. This would provide immediate relief for renters, preventing the build-up of problematic levels of debt and allowing them to stay in their homes as the country continues to weather the coronavirus storm.
Helen Barnard, Director at JRF said:
“Millions of people are anxious about paying the rent over winter, having run down their limited savings, reduced their spending and borrowed from friends, family or the bank. The worrying number of households already in arrears shows renters are running out of options. Without action we could see a wave of evictions and a surge in homelessness over the winter.
“The Government acted swiftly during the first wave of the pandemic to ensure no one would be forced from their home, rightly recognizing that we all want to protect one another from harm during this crisis. Bringing back a watertight ban on evictions now is the right thing to do.
“But without action which seeks to address growing arrears, any ban on eviction or enforcement only kicks the can down the road, with renters vulnerable to losing their homes again as restrictions are lifted. A targeted package of support to address high rent arrears will give renters and landlords much needed breathing space as we continue to weather the storm.”
An estimated 1.3million households in the private sector (30%), and 1.2 million households in the social sector (27%) are worried about paying their rent over the next three months. Social rented tenancies are generally the cheapest tenure, so it is concerning that so many social tenants are worried about meeting their housing costs. Families with children that rent privately are more likely to be worried than other households, with four in ten, approximately 600,000 households, worried about paying their rent over winter.
While the recent extension of the original furlough scheme will have mitigated some level of risk for some people, for many its announcement will have come too late, with recent ONS data showing redundancies reaching a record high of 314,000 in the last quarter.
People who have experienced or expect a drop in income, people who are already unemployed and those on lower incomes are being hit hardest. 61% of all renter households where someone is facing a drop in income in November and 62% of renter households where someone is unemployed are worried about this. 38% of private renters with a household income below £25,000 are worried about paying their rent over the next three months, and this rises to a stark 70% for households at this income level who are expecting a drop in income.
Renters are using multiple strategies to try to stay afloat. 41% of private renters and 34% of social renters who have seen a drop in income have used their savings to offset this, but levels of savings among these groups is not high, with one in four private renters (42%) and two-thirds of social renters (65%) in the UK having savings of less than £500.1 Across all renting households who reduced their spending to offset a loss in income, 70% cut back on food for the household, and 49% cut back on heating and electricity. 39% of renters with children who have reduced spending have cut back on items for children such as food and nappies. As we head into winter and continue to feel the economic impact of lockdown measures, renters may find themselves in real hardship, left with fewer options when it comes to paying the rent, heating their homes and feeding their families.
700,000 renters are currently in arrears with their rent and 1.7m (19%) are in arrears with household bills or council tax payments. Approximately 80,000 households in the private sector and 125,000 households in the social sector have arrears of more than £1,000. JRF estimates the current total household arrears runs into the hundreds of millions, with £400m of arrears in England and Wales as a conservative estimate.i 42% of private renters who are already in arrears have borrowed from either a bank or building society, payday lender, or friends and family.
350,000 renting households have had their landlord discuss eviction with them – 4% of all renters. Unlike the eviction ban that was in place between 31 March to 20 September in England and Wales, the current arrangements do not put a stop to proceedings, and cases will still be heard in court.
The research also found that black and minority ethnic renters are disproportionally worried about their ability to pay their rent over the winter period - 42% people in this group, compared to 27% of white renters in this position.
The briefing, Struggling renters need a lifeline this winter, is available to read on JRF's website.