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Rents in England branded unaffordable for young people on minimum wage

Rents in England branded unaffordable for young people on minimum wage

Renting in England is unaffordable for young people working on the minimum wage, according to one of the country's biggest mortgage lenders. The

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Renting in England is unaffordable for young people working on the minimum wage, according to one of the country’s biggest mortgage lenders. 

The average under-25 working full-time on the minimum wage would be unable to afford privately-rented accommodation due to high rents and large deposits, according to research by Yorkshire Building Society and the charity End Youth Homelessness. 

The research compared the earnings of young people with the average cost of private rented accommodation in every region of England, and found that none of them had rents that would be considered affordable.

Central London rents equal 251 per cent of earnings for a 21–24-year-old on minimum wage

Central London rents equal 251 per cent of earnings for a 21–24-year-old on minimum wage

Central London rents equal 251 per cent of earnings for a 21–24-year-old on minimum wage

It used think tank the Resolution Foundation’s definition of affordability, which states that, for rents to be considered affordable, they should be no more than 35 per cent of a person’s wage. 

For young people aged 21-24, working full-time and earning the minimum wage of £8.20 per hour, 71 per cent of their salary would need to go towards rent on average.

The least affordable areas were concentrated in London, with central London rents the equivalent of 251 per cent of the salary of a 21–24-year-old working full time on minimum wage.

The most affordable locations were found to be in Liverpool and Hull, where the average private rental would cost 38 per cent of the same worker’s salary.

‘Our new research findings are stark,’ said Mike Regnier, chief executive of Yorkshire Building Society.

‘There is not a single town in England where young people on the minimum wage can rent affordably.

‘With the average rental costing them 71 per cent of their salary, and in some areas up to 251 per cent, many young people are priced out of the private rented sector altogether.’

The research found that renting was even less affordable for those under 21. 

Young people aged 18-20, who receive a minimum wage of £6.45 per hour, would need to use an average of 91 per cent of their wages on rental costs.

For those under 18 working full-time, their wage of £4.55 per hour would not be sufficient to cover the average rent, which would amount to 129 per cent of their wage.

‘Our research makes evident that young people’s earnings are often too low for average housing across the country let alone to pay a deposit or cover the costs of establishing a home,’ said Nick Connolly, managing director of EYH.

‘This new data lays bare the urgency of the housing dilemma faced by many young people across the country. 

A total of 121,000 young people aged between 16 and 24 were either made homeless, or were at risk of homelessness in the UK last year, according to the charity Centrepoint

A total of 121,000 young people aged between 16 and 24 were either made homeless, or were at risk of homelessness in the UK last year, according to the charity Centrepoint

A total of 121,000 young people aged between 16 and 24 were either made homeless, or were at risk of homelessness in the UK last year, according to the charity Centrepoint

‘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.’

According to the charity Centrepoint, 121,000 young people aged between 16 and 24 were either made homeless or at risk of homelessness in the UK last year.

‘When young people have managed to overcome huge challenges and take their first steps into employment, they must not be confronted with impossible housing situations wherever they turn,’ said Paul Noblet, head of public affairs at Centrepoint.

‘We want to see genuinely affordable and sustainable housing options available for young people, including more social housing and additional help to make private renting sustainable.’

He added that young people worried about their housing situation or becoming homeless could call the Centrepoint helpline on 0808 800 0661.

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This post first appeared on Dailymail.co.uk

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