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Private renting unaffordable anywhere in England for young people on minimum wage
Private renting is unaffordable anywhere in England for young people on minimum wage, End Youth Homelessness (EYH) analysis has found.
People working full time for the minimum wage for under 25s – currently set at £8.72 an hour – will not be able to rent a home for less than 35% of their pay in a single corner of the country, according to research conducted by Yorkshire Building Society on behalf of EYH.
On average, rent would eat up 71% of these people’s wages, with that figure rising to 251% in central London.
Even in the most affordable areas of Liverpool and Hull, average rents would cost 38% of an under-25’s wages at the minimum rate.
According to the Resolution Foundation, housing costs should be no more than 35% of a person’s wage to be affordable and around a third is generally considered the rule of thumb.
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The situation is even harder for those under 21, for whom the minimum wage is lower at £6.45 an hour for people aged 18 to 20 and £4.55 for under 18s.
The “Affordability Index” research also highlighted that a full-time minimum wage job does not significantly improve a young person’s financial circumstances compared with claiming Universal Credit.
In some cases, young people in full-time work could be worse off than if they were on Universal Credit, making private renting less affordable for them.
Nick Connolly, managing director of EYH, said: “This new data lays bare the urgency of the housing dilemma faced by many young people across the country.
“The prohibitive costs associated with private renting are forcing the most vulnerable young people into desperate situations and COVID-19 has pushed even more young people closer to homelessness.”
EYH, which is a consortium of youth homelessness charities, has launched a Housing Fund aimed at helping young people rent independently in partnership with the Yorkshire Building Society.
