Families Forced to Downsize as Renting Costs Increase
The rising cost of renting and lack of options have forced thousands of families into smaller homes.
According to Dataloft, a property market consultancy, renters over 30 are likely to move to cheaper areas as the cost of renting has soared and availability has plummeted.
The National Housing Federation suggested more older people faced uncertain and expensive tenancies.
Rents have been rising rapidly, increasing more than 10% in a year for new tenancies in some areas. Demand is high, and the number of available homes has dropped.
Not only are young, single people finding it difficult to start, but families and older renters have been affected.
Dataloft estimated that almost half of the new tenancies taken on by families earning 30,000 or 70,000 in the first six months of this year were for one or two-bedroom homes.
In the first half of 2020, during the period covered by the first lockdown, 57% of new tenancies signed by families on that wage a year were for houses with at least three bedrooms, according to Dataloft.
In the same timeframe of 2023, that figure fell to less than 51%, which meant thousands more families a year are taking on smaller homes than in 2020.
Families Downsizing
Sandra Jones, managing director of Dataloft, said, “We believe these reductions in renters’ standard of living to be the direct result of the severe supply constraint that has driven up rents.
“When affordability is stretched, as it is for so many today, people make trade-offs in order to stay within a budget.”
About a fifth of people aged 30-39 moved to a higher-priced area while more than a quarter located somewhere cheaper.
Zoopla said a lack of availability of private rented homes was adding to the trend of families taking on smaller properties.
According to the 2021 census, 4 in 10 people renting through a private landlord agency are in 2-bedroom homes.
Executive director Richard Donnell said, “The slower buying and selling market meant greater demand for lettings, so people can only find or rent what is available.”
The National Housing Federation (NHF) said, “The number of people aged over 55 renting privately in England has increased.”
This has made it difficult for renters to cover basic living costs such as buying food, clothes, and even heating their homes.
Greg Tsuman, president of ARLA Property mark, said, “Fundamentally, the problem is that landlords are exiting the market when demand for rental properties continues to rise.
Landlords are making a loss when rents are rising, and we need to address the root causes if we’re to solve this.”
In the Autumn Statement, Chancellor Jeremy Hunt ended the freeze on the Local Housing Allowance, which began in 2020.
It determines how much help people who rent privately get towards the cost through housing benefits or universal credit. It will now be worth 30% of local market rents.
Angela Rayner, Labour deputy leader, said they had a housing recovery plan to “jump-start housebuilding” and “make renting fairer and more secure”.
