Let’s build our way out of the housing crisis

The recently released Shelter report called Shut Out: The barriers low-income households face in private renting, gives some sobering facts about the current crisis in UK housing, and why it’s urgent that the UK increases the supply of housing to stop people falling between the cracks of social policy.

The Shelter report focuses on the problem that people on low, or no incomes, face when they are forced to rent in the private sector. The Shelter data shows that in 83% of England, tenants face difficulties in meeting their rent payments due to rising rents, and a cap on Local Housing Allowance (LHA). LHA is the payment that councils provide to bridge the gap between the cost of the rent and the amount the tenant can afford to pay.

Shelter makes the case that if the cap is left in place then by the end of the cap period in 2020 almost one million households will be required to move, as the LHA payment will no longer be enough to help them meet their monthly rental costs. Shelter suggests that the cap should be removed, a position that is shared by the Local Government Association, the Joseph Rowntree Foundation and the Chartered Institute of Housing.

The problem with this is that the freeze on benefit payments, and the Conservatives pledge to ensure that out of work households would not be better off financially by claiming benefits than those who work for a living, has been seen to be popular, especially amongst the lowest paid section of the working population.

The Shelter report also raises some other issues which undoubtedly feature strongly in the reason so many people face the threat of homelessness. The fact that only 40% of households receiving LHA are in work when the UK has seen 10 years of rising employment levels, suggests that more needs to be done to address the skills shortage among many of those who receive the LHA.

The answer not only to the problem of increasing instability in the private rental market, but also the problem of young adults getting on to the housing ladder, can only be solved by building the homes people need in the areas where they can access quality jobs. Hopefully the Shelter report will help to further the realisation that the only way to beat the housing crisis is to build our way out of it.      

This article was written by Alan Gibbs, Account Executive at MPC in Reading