More than 630,000 households could be forced out of their privately rented homes because they can’t afford the rent. The All Party Parliamentary Group for Housing and Care for Older People calls on the new PM to prioritise low-cost rented housing to protect the pensioners of tomorrow.
A new report by a group of MPs and Peers is warning that unaffordable rents for older people could cause a surge in pensioner poverty in the next 20 years.
The report – Rental Housing for an Ageing Population – shows that the number of pensioners in the private rented sector (PRS) could more than treble to around 1.5m in the decades to come.
People typically see their incomes halve after retirement, and because many people in the PRS currently pay 40% of their earnings in rent, they could be forced to spend up to 80% of their income on rent in retirement.
Analysis for the APPG Inquiry by the Social Market Foundation think-tank shows that by 2038, if private sector rents rise at the same rate as earnings, more than 630,000 older people households may struggle to afford to stay in their homes and could be forced to move.
According to Shelter, private rents in England rose an average of 60% faster than wages between 2011 and 2017. Future increases like this without a boost to social house building could see a sharp rise in homelessness amongst older people.
The report also forecasts that, in terms of quality of accommodation, the number of older disabled households living in unfit and unsuitable private rented accommodation could leap from around 56,000 to 188,000 in 20 years’ time and to 236,500 in 30 years’ time.
The inquiry estimates that that 1.1m low-cost rented homes will be needed to adequately house older people by the late 2040s – an average of 38,000 homes a year. The report makes a series of recommendations for government and social housing providers, and suggests reforms that are needed in the PRS.
Lord Richard Best, who chaired the APPG’s Inquiry said: “We need action now to avoid sleepwalking into a situation where hundreds of thousands of older people will find themselves in insecure tenancies they cannot afford, fearing eviction and potentially even homelessness. The social and economic costs of this would be enormous. Housing Benefit costs would skyrocket.
“We urgently need a national strategy for renting in later life. This must include a plan to build more low-cost rented homes, and a programme of investment in care and support to prevent a housing catastrophe for the pensioners of the future.
“Social housing providers are the key players in this. But their current programme of around 3000 homes a year for older people will be not be enough even to help the existing social housing tenants who need to downsize in older age – and release family homes for the next generation.
“I hope our report will alert government, planners, housing associations and house-building councils to the vastly greater numbers of older people for whom low-rent, secure accommodation will be needed by our ageing population in the years to come.”
Brendan Sarsfield, Chief Executive of Peabody, who was a member of the inquiry commented: “The problem with the private rented sector is that people think it is the solution. It isn’t. Insecure tenancies and expensive rents mean that very often it is not a suitable tenure for older people.
Many older people today were lucky enough to be able to buy their own home and watch the value of it grow. But for the pensioners of tomorrow there is little chance of being able to do that. The broken housing market and failure of past governments to adequately fund social housing means that we are going to see many more older people struggling to pay the rent.
Councils and housing associations can do more but public investment will be needed to support them in meeting demand not just from their own ageing population of existing tenants but also from those forced to leave the private rented sector.
Investment now, both in capital grant and revenues to provide support services, could head off this crisis before it is too late.”
Kate Henderson, Chief Executive of the National Housing Federation said: “Young people are often referred to as a ‘generation of renters’ who have faced the brunt of the housing crisis. But today’s research shows that as social housing stock in England has decreased, along with government funding for it, many older people have been forced to rent privately too. There is now a rapidly growing number of older people who are struggling just as much as the younger generation.
“In privately rented accommodation people face extortionate rents, inaccessible accommodation and eviction at short notice. This isn’t an acceptable way for anyone to live, let alone older people who are more likely to be ill or less mobile.
“This must be a wake-up call to the Government that more money for building social housing, and especially housing that is fit for retirement, is desperately needed. Our latest research shows that the Government must invest £12.8bn in building new social housing every year if they’re to ensure all generations have somewhere secure and affordable to live.”
Dr Rachael Docking, Senior Programme Manager – Homes, at the Centre for Ageing Better commented: “As this report highlights, we have an urgent challenge on our hands to prevent people in later life being pushed into poverty or trapped in unsuitable housing in the years to come.
“More and more people are renting in later life, but too few homes in the private rented sector are affordable and accessible. Whether they’re renting in the traditional housing market or in bespoke retirement developments, everyone needs a home that’s safe and comfortable.
“We need a massive drive to build homes that can be lived in by anyone – from young families to older people with mobility needs. Private landlords, local authorities and housing associations all need to step up and make sure their housing meets the needs of people with disabilities or who have lost mobility with age.”