How are people affording housing

[MattBerningerstrophywife]

I live in a fairly low cost part of Scotland.
but recently I’ve been seeing rent for 2/3 bed flats between £800 to £1500 per month.

when the average salary is around £30k: how are people affording this?

I live in a part of Scotland where the cost of private renting has pretty much doubled in the past couple of years. A flat that cost £400 to £500 is now £800 to £1000 with houses even more expensive.

I own my home but there’s not a day goes by that I don’t think about how fucked I’d be if I was renting or trying to buy now. It’s insane & I feel so very sorry for young people with these now extremely high housing costs.

I guess a lot of people claim benefits / Universal credit to help pay the rent.

I don't know. My rent has gone up 50% since I moved in 3 years ago and is below market rate. My landlord is selling up and I can't afford any of the private rentals available in my area, or anywhere near. Kids settled at school, I'm a student. Housing associations completely overwhelmed. Honestly don't know what we're going to do.

I earn £1100 a month after tax and pension and my 1 bed flat in the Midlands has just gone upto £750 a month, it was £425 when we moved in 6 years ago.

I get about £200 a month uc and my wages. So more than half my wages I have to pay to rent before I've paid for anything else :(

I live in London and a one bedroom flat in my area starts at £1,700.

Probably receiving help through benefits?

By living in a town that I wasn't born in, miles from any of my family, in a social housing house that I hate, but I'm stuck because I can't afford to move.

I've no friends. No support group. No family near by. The walls are thin, the insulation is non existent, the garden is tiny and my street is horrendous.

But I've no choice. It's here or homeless as I couldn't afford anywhere else and private landlords hate pets and UC.

Definitely not, in my case.

I earn enough to absolutely never qualify for benefits, but also not enough to not be crippled by the housing market.

I left my (owned) marital home with my ex husband in it, and would be very very surprised if I’m ever in a position to save up to buy again. Paying rent at the rate we do and saving up the relevant buying costs is borderline impossible.

I bought a rural house that needed new doors, windows, roof, wiring, kitchen, bathroom, heating etc - that no-one else wanted. It had been on the market for 2 years. Then spent a decade gradually doing it up.

Most families surely have two adults working these days. If you're getting a 2/3 bed you're older/thinking about kids so likely at least one of you earning higher than min wage . Between you might be 50-60k.

Say one on 30k, one on 25k. That's 3800 after tax a month. You can afford £1,200 rent between you on that, its less than 1/3 of your net income.

What's caused the sudden price increase? Is it demand?

Those saying benefits - the benefits system is designed to "top up" to a livable income, the housing element of which is based on local housing allowance rates. Which are well below what rents actually cost. As an example, in my area, LHA for a 2 bed home is £600pcm. The cheapest 2 bed homes are £900-1000 pcm. 3 beds are around £1500, compared to the LHA of £750.

But the OP is asking how people afford high rents, when their pay is low?

My best guess would be by ending up in debt elsewhere, or by spending very little on other essentials like food.

They're not (affording it). With the consequence that billions is needed for temporary accommodation, and billions more for the NHS - because bad or insecure housing damages health. The housing crisis is also a major contributory factor in why DV victims can't/don't LTB.

The UK urgently needs more council housing and an end to RTB - for moral reasons, and to help the economy.

The housing crisis is having a massive impact on the fertility crisis but when I said this on that fertility thread the other day people bashed me.

I am in my mid 20s and I live in London and in increasing me HMO living is about £900-1.3k+ for a room. Primary schools are closing in London due to the housing crisis.

We spend a huge amount on temporary accommodation and it is making councils go bankrupt and a large amount of the benefits bill is spent on House and benefits going to private landlords.

it seems really unpopular on here to even say that the housing crisis is causing such a massive issue people don't want to except it. But it is, the ONS recently revealed in the sense results. The most common living arrangements for people under 30 was living with their parents.

everyone just thinks the solution is to build more houses, but we just need to build more council houses. there's no point building more private homes if no one can afford them.

Disagree strongly. More homes will push the price down; this has happened everywhere where we have actually done this (Austin, New Zealand, and it started to happen in Croyden until the local nimbies forced the building to stop).

Not against council housing, but it's just one possible model for housing people. Many countries have far less social housing than the UK, but more affordable property. In fact the UK scores quite high for the % of its housing stock that is social housing, yet its housing crisis is among the world's worst.

See here, for example:

Accounting for over 20% of the total housing stock, the sector is largest in Austria, Denmark, and the Netherlands. Finland, France, Iceland, Ireland, and the United Kingdom have a moderately-sized social rental housing sector (between 10 and 19% of the stock). By contrast, the sector is relatively small (between 2 and 10% of the total stock) in Australia, Belgium, Canada, Czechia, Germany, Hungary, Italy, Japan, Korea, New Zealand, Norway, Poland, Slovak Republic, Slovenia, Switzerland, and the United States. The social housing stock is smallest in Colombia, Estonia, Israel, Latvia, Lithuania, Portugal, and Spain, where it accounts for less than 2% of the total housing stock (data on the number of dwellings in absolute terms are available in the online Annex, PH4.2.A1). www.oecd.org/content/dam/oecd/en/data/datasets/affordable-housing-database/ph4-2-social-rental-housing-stock.pdf

No clear relationship at all between the % of social housing and the extent of housing crises (Israel, for example, has very affordable housing and a high fertility rate - and it's almost all done through the private sector).

Social housing per se is fine but you do need to actually build it, and it's not clear to me that the public sector in the UK has the money to start building tons of housing stock. It would be easier to reduce regulations/change the planning law, and make it easier for the private sector to build like mad.

But none of those of the countries have quite the same wage to house price to wage ratios as it we are one of the worst economies for that. I live in London and there's plenty of new builds sat empty even in Croydon there's a lot of new builds that are being built sat empty. People can't afford to buy and are sat empty.

it's important that we're building housing that is actually affordable and people can afford to rent or buy.

Build more and the price will come down. This has worked everywhere where it has actually been tried.

Yes, and everywhere it has worked they have tended to do a mixed amount of tenures so it's not all just private developers building it has been a mixture of private, social/affordable.

We can't agree to disagree

There is a local housing allowance cut off - so for example, if £430 is the max allowance you'd have to pay for the rest yourself somehow.

Build more and the price will come down. This has worked everywhere where it has actually been tried.

No it hasn't. As @MotherOfRatios says, she lives in London and there's loads of empty new builds in Croydon. I know that's true. A friend of mine lives in a different part of London and it's the same where he is. And it's not only London. Where I live too.

Millions of people are on low wages (and someone has to do those important jobs). Plus there's disabled people unable to work, and full-time carers. They will never be able to afford buy regardless of how many non council homes are built.

Your idea would only work if mortgage lenders significantly reduced their minimum income requirements and also if housing benefits could be used to pay a mortgage instead of private renf (actually would be cheaper for taxpayers but will the government do that?).

Social housing per se is fine but you do need to actually build it, and it's not clear to me that the public sector in the UK has the money to start building tons of housing stock.

There's the money. Billions is spent every year on private rent housing benefits and billions more on (often substandard) temporary accommodation. Plus billions needed for the NHS - because, as published in the BMJ, private renting is more harmful than smoking. It would save billions if instead more council housing was built.

I've recently just left zone 4 NW London lots of newbuilds but a lot are empty and I get emails ALL the time to buy with freebies like 6 months worth of a mortgage paid if you reserve now.

Private developers are merging because they're making a loss and there's a skills shortage. I think it was the FT who recently said developers aren't planning to build much in the coming years.