1.3 million families face unaffordable housing costs

At least 1.3 million families on lower incomes have to spend more than they can reasonably afford on housing, according to a new analysis from the Resolution Foundation think tank. The figure represents almost one in four of the 5.6 million low-to-middle income households of working age in Britain.

Key findings

  • 1.3 million families face unaffordable housing costs, where housing costs eat up more than 35 per cent of their net income.
  • Of the total, 590,000 are private renters, 585,000 are owners with a mortgage, and 100,000 are social renters.
  • Two thirds are outside London and the south east.
  • A disproportionate number, 570,000, are younger families where the head of the household is under 35.
  • The analysis looks only at regular monthly housing costs – it does not take into account the cost of saving a deposit in order to buy a property or secure a rental. Previous Resolution Foundation research has shown that saving a buyer's deposit would typically take a low-to-middle income family more than 20 years.

Commenting on the analysis findings, the Resolution Foundation's Vidhya Alakeson said: 'Many families are struggling to find any type of housing which fits both their needs and their budget. Often they are making difficult choices which mean going without other essentials to pay their housing bills or living in overcrowded conditions – all this at a time when other living costs are rising. We've become used to the idea that buying a property is now an impossible dream for millions of people on low to middle incomes – in a typical case it would take 22 years just to save the deposit. But increasingly, private rent is also becoming unaffordable even though, for many families, it is the only option'.

Source
: Press release 16 May 2013, Resolution Foundation
LinksResolution Foundation press release | Guardian report | Telegraph report

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Publication date: 
May 16 2013