Renters forced to turn to state benefits to afford rising cost of living

“As rental prices have soared in recent years, many renters have raided savings pots and borrowed to make ends meet. After exhausting those options, many renters are now forced to turn to benefits to meet their monthly bills.” (Credit: PA)

Almost a third of renters have been forced to turn to government benefits as a result of spiralling rental costs in the UK.

According to research from lender Creditspring, three in 10 renters have had to lean on benefits to get by, with another 40 per cent stating that this is the most financially unstable they have ever felt.

Data from the Office for National Statistics finds the average cost of rent in the UK rose by 9 per cent in the 12 months to February this year – the highest annual increase since records began in 2015.

Neil Kadagathur, chief executive at Creditspring, says: “As rental prices have soared in recent years, many renters have raided savings pots and borrowed to make ends meet. After exhausting those options, many renters are now forced to turn to benefits to meet their monthly bills.”

Research published by data-gathering website Statista suggests landlords were increasing their prices due to the rising cost of running a rental property.

Sharp rises in rental values have a greater disproportionate impact on young people, who are less likely to have made it on to the housing ladder and more likely to be living in rental accommodation.

As such, further research from Creditspring previously found that money worries are creating a mental health time bomb for young people, with almost 40 per cent of 18-to-34 year olds saying their mental health has significantly worsened as a direct result of the cost of living crisis.

The lender found a third of young people say they are more in debt now than they were 12 months ago, with a further third saying their financial worries have reached the point where they are unable to sleep.

Kadagathur adds: “Forced to put up with ever-growing essential costs, many renters are faced with little option but to borrow each month to keep pace with rising rents – a vicious cycle where debt piles soar but savings pots vanish as they struggle to make ends meet.

“This is driving many into unsustainable levels of debt and has forced growing numbers to return to family homes as they simply cannot afford to continue to live independently.”