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Millions may be pushed into poverty by 2040


Social policy charity the Joseph Rowntree foundation has released a report advising that the rising cost of private rents are on course to push thousands of people into poverty while adding billions of pounds onto the UK’s housing benefit bill.

Using detailed historic data to examine the relationship between housing and poverty, the report has found that the private rents in England are forecast to rise almost twice as fast as UK incomes. This would in turn push poverty rates amongst private renters up to 53% by 2040.

It also shows how the decline in social renting and the rise in private renting is likely to become more pronounced over the next few decades, leading to one in five people in the UK living in privately rented accommodation by 2040.

The report says that poverty levels in England can only be contained if housing supply nearly doubles to 200,000 homes a year by 2040; social rents do not move closer to market rates and rises are limited to 1 per cent over inflation; Housing Benefit meets a similar proportion of rent as in 2008; and occupancy patterns remain unchanged.

The charity says that if social rents continue to rise towards market rates, the cost of Housing Benefit could rise by 125% - adding £20bn to the current bill.

Its chief executive, Julia Unwin said:

"These stark findings are a wake-up call for political leaders. After decades of failing to build enough, those in power have a responsibility to act now to build more genuinely affordable homes.

"We need a clear strategy that builds the homes we need in the right places and avoids locking low income households out of affordable homes.

"This is about more than frustrated aspirations of home ownership from Generation Rent: the reality facing many people is a life below the poverty line because of the extortionate cost of keeping a roof over your head.

"Addressing the rising cost of housing is crucial to tackling the high levels of poverty in the UK."

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