UK rents rise faster in deprived areas – and drag
more people into poverty
Cost doubles in some poor urban districts, driven in
part by mortgage rate rise, UK-wide study shows
Sian Norris
Sun 3 Sep
2023 06.00 BST
People
living in the most deprived areas of Britain have seen their rents increase by
52% over the past four years – while for tenants in the wealthiest regions,
rents have risen by only 29%, new figures show.
“It is
shocking to see that home rents have been rising in areas where people are
least able to afford to pay more,” said Dan Wilson Craw, deputy chief executive
of Generation Rent.
The
countrywide data analysed by the estate agent Hamptons and shared with the
Observer reveals how, in 2019, renters in the most deprived regions were paying
an average of £499 a calendar month – by 2023, that had shot up to £759.
In
contrast, those renting a property in Britain’s most affluent districts were
paying an average monthly rent of £1,078 in 2019, going up to £1,387 this year.
Polly
Neate, chief executive of Shelter, told the Observer: “The private rental
sector is creaking under the weight of demand as rents spiral out of reach of
local incomes and tenants are pitted against each other for a limited supply of
homes.”
Landlords
in less affluent areas rely more heavily on mortgage finance than their
wealthier peers, according to Hamptons, helping to drive up costs. Interest
rates have gone up from 1.75% in August 2022 to 5.25% today, with some passing
on rising costs to renters. Tenants in deprived districts have seen monthly
rents increase by a typical £97 since 2022.
“Over the
past couple of years, more people have wanted to live in cities, where areas of
high deprivation are concentrated,” said Wilson Craw. “Financial pressures have
pushed many renters into relatively cheaper areas of cities to find an
affordable home, and the effect has been to push up rents for those people
already living there”.
The figures
reflect how Britain’s continuing housing crisis is combining with the cost of
living crisis as rent, mortgage rates and rising food and energy costs squeeze
incomes.
Renters are
already more likely to be living in poverty. According to the 2022 annual
poverty report from the Joseph Rowntree Foundation, a third of private tenants
(4.2 million people) are in poverty, driven by a combination of high housing
costs and low incomes. Almost a half (46%) of private renters living in poverty
say they have been pulled into it by their housing costs.
How rent
rises compare in deprived and affluent areas of Britain
Of the most
deprived regions in the UK, the district with the highest percentage rise in
rental costs was Linthouse, Glasgow, where monthly rents increased from £597 in
2019 to £985 this year – a rise of 65%. Just under a third (30%) of children in
Glasgow city live in poverty.
For tenants
in affluent Ascot in Berkshire, rents are higher than in Linthouse but the
percentage increase is far lower. Monthly rents rose from £3,224 in 2019 to
£4,163 in 2023 – an increase of 29%. Child poverty rates in the wider Windsor
and Maidenhead region are 19%, and more than two-thirds of Ascot residents own
their own homes.
Low incomes
and high costs are also adding to problem debt. Joseph Rowntree Foundation data
found 20% of low-income households taking on new debt to pay for rent and
energy.
‘It’s brutal. We need regulation’
Esther
Planas, 62, has called Hackney, in east London, home since the late 1990s, when
she moved to the UK from Spain. An artist, she has lived and worked in the
borough ever since, admitting that in some ways she was “part of the
gentrification”.
Planas is
now faced with having to leave her home due to increasingly high housing costs.
Her landlord recently informed her that her monthly rent will go up from
£1,1175 to £1,620 – an increase she cannot afford.
“It’s a
huge amount of money,” she told the Observer. “I live in a vulnerable and
precarious context as an artist. My income is from selling my work, teaching,
lecturing, and grants. I considered becoming officially homeless and getting
help from the council, but the waiting list is years long.”
This is not
the first time rising rents have forced Planas from her home. Her previous
landlord evicted all the residents from the block of studios where she used to
live. Now the street is full of “VIP apartments”.
The stress
of losing her home, and the struggle to find a new place to live, is affecting
her mental health. “I feel anxious, I have trouble sleeping. Everywhere I look
is £1,300 or £1,400 a month, but mostly, £1,500, £1,600, or £1,700, even
outside Hackney. It is impossible.
“It’s
brutal. We need regulation. We need something to change.”
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