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England's 'economic recovery' pushing hundreds of working people onto housing benefit daily

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England's 'economic recovery' pushing hundreds of working people onto housing benefit daily


Published by Max Salsbury for in Housing and also in Local Government

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Though parts of England might be showing signs of economic recovery, conditions are pushing 310 people a day onto housing benefit, a new report has revealed.

The National Housing Federation's 'Home Truths' report shows that in parts of the country that are yet to recover from the recession, high unemployment and low wages are leaving families desperately struggling to make ends meet and communities at a standstill.

Every five minutes, rapidly rising rents in growth areas such as London force another working person to turn to the government for help with their housing costs.

The NHF says that taxpayers have picked up a tab of £12.1 billion spent on housing benefit for working people since 2009, at a cost of an extra £1.7m a day, as a consequence of not building enough homes in areas of growth over many successive years.

And the Federation predicts that by 2020 the picture will be even bleaker. House prices will have risen to the point that an entire generation will be locked out of home ownership and forced to rent for life. But rents are also forecast to soar by an average of 39% by 2020, causing further severe financial consequences for the taxpayer.

The Home Truths report found that:

• England is already extremely short of housing and the gap between supply and demand is widening. 240,000 homes are needed every year to meet demand but housebuilding numbers are falling. In 2012/13 107,000 new homes were built, 10% less than in 2009.
• Rents are soaring out of the reach of many. Currently rents take up an average of half of people’s disposable income but in a decade’s time that figure will have rocketed to 57%.
• House prices will increase by another 35% by 2020, leaving a huge swathe of the population locked out of home ownership for life.
• Government spending on housing benefit has risen to £24bn, but most of this money is going to private landlords rather than building the new homes which would stem rising housing costs.

The NHF is calling for more homes to be built in the areas that are growing economically, and at the right prices that people can afford, whilst in areas that are stalled economically, Local Enterprise Partnerships (LEPs) need to work with housing associations and other partners to revitalise struggling communities, create jobs and invest in social enterprise.

David Orr, NHF chief executive, said: “We hear a lot about ‘making work pay’, but a decent job won’t even cover the cost of a home in England. Billions of pounds of taxpayers’ money is wasted, lining the pockets of private landlords, when it could be better spent building more homes people can afford. Relying on the private rented sector so heavily is a costly sticking plaster rather than a solution.

“In towns and cities pulling away from the recession the dysfunctional housing market is burning the fingers of many people. Hard-working families are spending more and more of their income on a home and many could be forced to move - away from jobs, schools and relatives. We need to address the problems of the housing market now, before another generation is left locked out and reliant on taxpayers to keep the roof over their head."


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