'Young people are being locked out of all housing options in the South East'
New research has revealed that plans to extend the Local Housing Allowance cap could make even social housing too expensive for young people on lower incomes in the South East. Dr Kesia Reeve, of Sheffield Hallam Univesity's Centre for Regional, Economic and Social Research, explores the problem.
Over the past six months we have been working with CASE (a consortium of ten housing associations in the South East of England) to explore the housing challenges facing younger people (16-34 year olds) in the region and to consider how housing associations can be part of the solution. Our research, published this week, shows clearly that the difficulties facing younger people, particularly those on low incomes, are considerable. And they are set to worsen as the Government forges ahead with plans to introduce LHA caps into social housing.
The difficulty facing 'generation rent' in accessing home ownership has been given considerable media and policy attention but our research suggests that, in the South East at least, 'generation rent' cannot even afford to rent. Our analysis shows, for example, that 51% of all younger people in the South East cannot afford the cheapest rents and that median rents are unaffordable for the majority (76% of 16-34 year olds, and nearly all under 25s).
In this context, the social rented sector has a crucial role to play in meeting younger people's housing needs. Indeed, the social rented sector accommodates around 60 per cent of younger people in receipt of housing benefit in the South East.
Any reduction in the number of social rented tenancies available to younger people is, therefore, likely to propel a greater number into housing crisis. Our analysis suggests that introducing LHA caps into social rented housing undermines the affordability of this tenure for younger people. In the South East, the majority (84%) of younger people in receipt of benefits would face a shortfall between their rent and their housing benefit if the Shared Accommodation Rate (SAR) were applied. And the shortfall they would face is significant: a massive £55 per week on average.
The reason for this is not that social housing is expensive - we know it is not - but that shared accommodation is simply not available on the scale required. Housing associations will, therefore, be hampered in their efforts to meet the needs of younger people in a post-LHA cap world by the nature of the homes they own, and the procedures they share with local authority partners regarding the allocation and management of those homes. We applaud the CASE partners for commissioning this research in the hope of answering the question: 'What can we do to help and how can we develop affordable solutions for younger people?" Our concern is that others, considering the SAR as an unsurmountable risk, will cease to rent social housing to younger people on low or insecure incomes, effectively restricting the only tenure that remains affordable to younger people in some parts of the country.
The word crisis is over-used but it is not an inappropriate term to convey the depth and severity of the problems facing younger people in the contemporary housing system in England.