Money Wellness
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category iconcost of living
calendar icon12 Apr 2024

Rent increases overtake wage growth- many will struggle research finds

Think tank Resolution Foundation has found that average rent prices could rise by 13% in the next three years, which means they’ll outpace the projected average wage growth of 7.5%

Calls for policymakers to provide solutions

The Foundation’s senior economist, Cara Pacitti, said: “Millions of families agreeing new tenancies across Britain have faced surging rents in recent years, as we have emerged from the pandemic.

“Those rises for new tenancies are starting to slow, but how much renters actually pay will continue to outgrow how much they earn for some years to come as those not yet exposed to higher prices are hit. With more families renting privately, and renting for longer too, these rent surges are a bigger problem for Britain, and require bolder solutions from policymakers.

“Short-term solutions include regular uprating of Local Housing Allowance to support poorer families, and the ultimate longer-term solution is to simply build more homes.”

Ben Twomey, the chief executive of Generation Rent, said: “Renters have nowhere to hide from the housing crisis. It doesn’t matter what you’re earning: if your landlord thinks someone else would pay a higher rent, then they can demand more from you, and threaten you with eviction if you push back.”

 “Rising rents mean we have less to put aside for the future, and less to spend on actually living.As well as building more homes and giving enough support through the benefit system, the government needs to stop landlords raising rent beyond what we as tenants can actually afford.”

Struggling with rent costs?

Talk to your landlord

Try and maintain a good relationship with your landlord by being honest about the difficulties you’re facing. It can be awkward talking about money problems but your landlord can’t help you if they don’t know what’s going on.

Payment plan

See if you can agree a payment plan for any rent arrears you have. Work out a budget to see what’s affordable each month that you can share with your landlord.

Benefits check

It’s believed a whopping £19bn of income-related benefits and social tariffs go unclaimed every year in the UK. Make sure you’re not missing out on money you’re entitled to by using our free benefits calculator. Local councils also have money set aside to help people struggling with the rising cost of living. This money is provided under a scheme known as the household support fund. Contact your local council to see what’s available in your area. 

Prioritise your debts 

Rent is a priority debt, so you should pay this before things like credit cards, personal loans and buy now pay later. Find out more about how to deal with priority and non-priority debts

Get free debt advice

If you’re struggling to pay your rent, you should get debt advice as soon as possible. Our debt advice is available online and over the phone. We’ll run through your finances and then let you know what help’s available. Maybe you just need a hand with budgeting. Or maybe you’d benefit from a debt solution.

Debt solutions can reduce your monthly debt repayments and even write off some of what you owe. Of course, you’ll need to weigh this up against the fact your credit rating’s likely to be affected. But we’ll run through all the info you need on your various options.

All of our advice is free and some debt solutions are also free. For others, there’s a fee. We’ll give you time to digest the info we’ve provided, talk it over with friends or family and ask us any questions you might have. If we’ve suggested a debt solution as a suitable option and you decide you’d like to go ahead, we can help get it set up for you.

 

Avatar of Lydia Bell-Jones

Lydia Bell-Jones

With a background in banking, Lydia has been writing professionally for over five years. She is passionate about helping people improve their personal finances and has a particular interest in the connection between money and mental health.

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