450,000 UK families in rent arrears because of COVID-19

450,000 UK families in rent arrears because of COVID-19

A total of 450,000 families across the UK are reported to have fallen behind on rent as a result of the coronavirus crisis, according to new figures released by the Resolution Foundation.

The report found that 9% of families in the social rented sector were behind with their housing payments in January 2021, alongside 6% of those renting privately and 2% of mortgaged homeowners.

The Resolution Foundation revealed that 300,000 of those households behind on rent contained dependent children.

At the same time, close to one-quarter (24%) of private renters have seen their earnings fall during the last ten months, compared to one-in-six (16%) working-age adults with a mortgage.

The survey has also indicated that twice as many privately-renting families entered the pandemic with no savings compared to mortgaged homeowners (22% and 11% respectively).

Despite widespread calls for forbearance in the face of the COVID-19 shock, 3% of private renting families have been able to negotiate a lower rent over the last ten months (a further 5% have been refused), compared to one-in-ten (10%) families with a mortgage who have received a mortgage holiday.

The figures also revealed that more than half (56% ) of private renter families with arrears are not in receipt of benefits, leaving them ineligible for a Discretionary Housing Payment.

Lindsay Judge, research director at the Resolution Foundation, said that many families had suffered ‘huge hits’ to their earnings and had “limited savings” to fall back on.

She said: “To make matters worse, measures that could ease the pressure, such as discretionary housing payments from local authorities and negotiated rent reductions from landlords, are not getting through to those that need them.”

The Resolution Foundation added: “Both benefit cuts and the end of furlough are pencilled in for the spring, either of which will strain family incomes further.

“Likewise, unemployment looks set to rise, rather than fall, through 2021, potentially driving up arrears further still.”

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