Yahoo Finance Tenants most likely to be struggling amid cost of living crisis
People who rent their homes are over four times more likely than homeowners to be going through some form of financial hardship amid the cost of living crisis.
Over half (55%) of renters said they said they would be unable to afford an unexpected, but necessary, expense of £850, compared with 12% of outright homeowners, the Office for National Statistics (ONS) said.
The latest analysis of the impact of the increased cost of living on adults across Great Britain by the ONS found that around a third (34%) of people aged 25 to 34 reported borrowing more money or using more credit than usual compared to a year ago.
55% of adults living in rented accommodation said they wouldn't be able to afford an unexpected but necessary expense of £850🏡
The same was found for 12% of those who own their home outright. pic.twitter.com/V6yfDN6Zmo— Office for National Statistics (ONS) (@ONS) February 20, 2023
A quarter (26%) of adults earning £20,000 up to £30,000 per year reported borrowing more money or using more credit than usual.
Overall, younger adults, those with pre-school aged children, and those on pre-payment energy meters were all more vulnerable to the squeeze on incomes.
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Around half (54%) of parents living with a dependent child reported being unable to save in the next 12 months. The figures also show that parents living with children had higher odds of experiencing some form of financial vulnerability.
“Today’s analysis is part of our work to identify inequalities in society. We can see that the some of the groups most likely to be experiencing financial vulnerability are also those we have previously shown to experience food and energy insecurity, including parents with dependent children and those renting their accommodation. This highlights the additional pressures these groups are facing,” Tim Vizard from the ONS said.
34% of adults aged 25 to 34 years reported borrowing more money or using more credit than usual in the last month, compared to a year ago💷
By contrast, only 7% of those aged 75 years and over reported the same. pic.twitter.com/INBNjWvwJH— Office for National Statistics (ONS) (@ONS) February 20, 2023
People who pay for their gas or electricity through prepayment meters were almost twice as likely to report using credit because of the increases in the cost of living (26%) than those who do not pay for their gas and electricity through a prepayment method (14%).
Read more: UK pay rises at fastest rate in 20 years but fails to keep up with inflation
It was revealed earlier this month that debt agents for British Gas had broken into vulnerable people's homes to force-fit meters.There are more than 4 million UK households on prepayment meters.
Polly Neate, chief executive of charity Shelter, said: “Even before the cost-of-living crisis, private renters were paying the highest housing costs of anyone. Now sky-rocketing private rents mean people are forking out the bulk of their income to keep a roof over their heads, leaving them with nothing to fall back on.
“Every day our emergency helpline hears from tenants who after paying their rent cannot afford to turn on the lights or put food on the table. All it takes is for the fridge to break or an unexpected bill for a family to be thrown into a spiral of debt and pushed to the brink of homelessness.
“The government cannot ignore struggling private renters. It must unfreeze housing benefit, which is stuck at 2020 levels, in the Spring Budget so that people aren’t constantly living on a knife edge. But to solve the housing emergency for good, it must build the genuinely affordable social homes with rents pegged to local incomes.”
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