Housing and poverty

Housing costs are a major driver of poverty, and poverty rates vary substantially by tenure. In 2023/24, around 4 in 10 social renters (4.4 million people) and 37% of private renters (4.8 million people) were living in poverty after housing costs.

The drivers of poverty differ by tenure. Poverty among social renters is largely driven by low incomes, reflecting both lower earnings and higher reliance on social security. By contrast, private renters are far more likely to be pulled into poverty by high housing costs. Around 4 in 10 private renters who are in poverty are only in poverty once housing costs are considered.

Source: Households Below Average Income, 2023/24, DWP

Across tenures, poverty rates broadly followed the overall trend in after-housing-costs poverty: falling through the late 1990s and early 2000s, before largely stagnating. However, the number of people in poverty within each tenure has changed markedly over time, with a substantial rise in the number of people in poverty living in the private rented sector.

Changes in the tenure profile matter. Had housing costs remained lower — through greater provision of social housing, higher rates of homeownership, or stronger constraints on private rent increases — poverty rates would likely have fallen further. Instead, growing reliance on the private rented sector has exposed more households to high and rising housing costs.

Poverty rates among social renters have remained relatively stable since 2004/05, typically between 42% and 46%, before dipping to 40% in the latest year. Among private renters, poverty rates have fluctuated between 32% and 39%. While these rates are below the peaks seen in the mid-1990s (55% for social renters and 44% for private renters), they remain persistently high and far above those for owner-occupiers.

One striking long-term trend is the growth in the number of adults living in concealed households — for example, young adults living with parents or other family members — reflecting housing scarcity, unaffordability and inadequate incomes.

Since 2001/02, the number of young adults aged 18-34 living in concealed households has increased by 1.7 million to 5.2 million. For this age group, concealed households are now the most common housing arrangement: 37% live in concealed households, compared with 28% in private renting, 26% in owner occupation and just 9% in social renting.