15th January 2016
A recent survey shows that 20% of people in the UK cannot afford to pay their rent this month from their salary alone. Instead, they will turn to finance solutions such as credit cards, payday loan lenders and overdraft facilities.
According to the survey, conducted by Spareroom.co.uk, not all of the 20% will look to take out money with nearly 3% of them dipping into their savings or other sources to meet the cost.
Respondents were each asked how they were going to manage the shortfall for their January rent, in total over 1000 of the websites users completed the survey. Alarmingly, 6.5% of people said they had no way to make their monthly rent payment. On the other hand, over 6% said they would use their overdraft or credit card service with a further 2.5% turning to friends or family to lend a helping hand. Payday loans were also the answer for many, with 1.7% planning to take out a short-term payday loan.
The director of Spareroom, Matt Hutchinson, explained that January is often a tough month financially following the Christmas period. This year could be even tougher he said ‘with 45% of landlords considering rent increases in 2016, the prospect looks bleak for renters.’
He recommends that anyone who fears that there rent increases could leave them unable to pay talk to their landlord as soon as possible.
He went on to add that ‘most landlords realise that the cost of finding a new tenant often outweighs the extra they’ll get by putting the rent up and may be willing to negotiate, especially if you’ve been a reliable tenant.
The increase in rent costs has been put down to the lack of affordable homes in the UK; a recent study by Shelter revealed that two and a half million parents were making cuts at home to meet their rent and mortgage payments. This included cutting down on household essentials such as food shopping as well as gas and electricity. Their study also showed that an alarming 1 in 10 parents would not be able to meet their housing costs this month.
Looking at the figures, it is not a surprise that more and more people are struggling under ‘the weight of monthly payments’ according to Nadeem Khan, an adviser at Shelter.
Far too many people call us after struggling in silence with spiralling housing debt and feeling they have nowhere to turn’ he said, advising anyone in this situation to contact the helpline for advice.
So, if you are struggling and do not have a solution in place, act now and stop the problem growing. There are many ways to resolve your problems, so get help to find the right one for you.