Fresh investigation by The Bureau of Investigative Journalism and voice.wales has shown how the poorest people in Wales are being locked out of almost all private rental properties.
New data comes as proposals to freeze rent in Wales were voted down in The Senedd
By Rebecca Wilks
Housing benefit would need to be increased by an average of £200 to cover the cost of spiralling rent in Wales, a joint investigation by voice.wales and The Bureau of Investigative Journalism has revealed.
As the cost-of-living crisis deepens, our analysis – which looked at thousands of two-bedroom private rental properties advertised across the UK in July this year – found that 99 percent of available homes in Wales would have been too expensive for someone on Universal Credit or housing benefit to afford.
It comes as the UK Government signals a further round of painful public spending cuts, and following a Senedd debate last week which saw Welsh Labour, the Welsh Conservatives and the Welsh Liberal Democrats vote against introducing a rent price freeze and an eviction ban during the crisis.
Rent price crisis
The amount someone receives in housing benefit is determined by Local Housing Allowance (LHA), which is based on an estimation of what it costs to rent the cheapest 30 percent of homes in the local Broad Rental Market Area.
Though rent has risen significantly in the last couple of years – along with energy bills, food prices, and other essential living costs – LHA has remained frozen at March 2020 levels.
For its analysis, the Bureau of Investigative Journalism looked at more than 40,000 adverts for 2 bedroom private rental properties across the UK in July this year, comparing rent prices in each Broad Rental Market Area to the amount that a person living in those same areas would receive in housing benefit.
This data was shared with voice.wales as the Bureau’s partner in Wales.
Overwhelmingly, we found that financial support did not cover costs.
Of the 670 properties advertised for private rent in Wales in July, just six charged a rent that a person on benefits could afford - equivalent to one percent.
These six properties were found in the Cardiff, Swansea, Wrexham and North Clwyd rental market areas, and were not on the market long.
In the capital, just one property of the 265 advertised was affordable - with a let agreed and the ad removed within a week of it appearing.
Even with a monthly top-up of £100, housing benefit would still not have covered the cost of rent for any of the properties advertised in the Taff Rhondda, Merthyr Cynon, Bridgend, Neath Port Talbot, North Powys, Torfaen, Carmarthenshire, Pembrokeshire or Ceredigion areas.
For housing benefit to fulfil its original purpose - that is, to cover the cost of renting one of the cheapest 30 percent of properties in your local area - it would need to be raised by an average of £200 per month in Wales.
Alongside unaffordable rent costs, some landlords stipulated extra conditions that would push homes out of reach, even if a tenant could cover costs.
One landlord stated that they would not rent to households with children, while another in Llandaff was only open to tenants over the age of 30. Many would not rent to those with pets.
According to UK Government statistics, families with children represented 50 percent of households on Universal Credit as of May this year - a jump of six percent from the same time in 2021 - while under 30s made up just over a quarter of UC claimants as of September.
“Discrimination is rife in the private rented sector,” a spokesperson for housing charity Shelter Cymru told voice.wales.
“Far too many tenants face barriers because of factors such as age, disability, race, and whether they claim benefits.”
“We carried out a survey [earlier this year] in which more than a third of landlords said they don’t - or that they prefer not to - let to tenants on benefits. Almost half said they wouldn’t let to people who are homeless, and more than half wouldn’t let to people with pets.
“However it’s really important to emphasise that discrimination is socially unacceptable to a lot of landlords.”
Some rental adverts set out a minimum income amount for potential tenants, asked for a credit check, or required tenants to provide a guarantor - a UK-based homeowner who agrees to pay rent if the tenant falls behind - as part of their application. Many charged a £100 admin fee on top of a deposit and the first month's rent in advance.
An increasingly common ask by landlords and letting agents, providing a guarantor can prove impossible for those whose family does not own property, those whose family live abroad, and those who are not in contact with their family - a particular risk among LGBTQ people.
“Most of the cases we see wouldn't have an issue paying rent, but they are either refused rooms due to being on Universal Credit or not having a guarantor, or they are unable to find safe shared housing due to their transness,” said a spokesperson for TransAid Cymru, a mutual aid organisation supporting transgender, intersex and non-binary people in Wales.
“The housing crisis is ravaging the trans community - I can't stress enough how sharply this crisis is hitting us, we are exhausted and overwhelmed.
“We want to see specific housing projects for LGBTQ people of all ages who are experiencing homelessness, designed and run by LGBTQ people themselves.
“We want to see meaningful change to stop landlords from gatekeeping housing from the poor and vulnerable - and maybe one day the abolishment of landlords as a whole!”
Resolving the Crisis
Last week, a Senedd debate on implementing a rent freeze and eviction ban was called by Plaid Cymru, but the motion was voted down.
Warning that a rent freeze could result in “very serious unintended consequences”, housing minister Julie James told the Senedd: “We do not want to drive landlords away from the sector; we want to make sure that people take advantage of the PRS and stay in their homes.”
Shelter Cymru also opposed the notion of a rent freeze. Asked to explain the charity’s position, a spokesperson told voice.wales: “This isn’t because we think private sector rent levels are OK – far from it.
“The cost of living crisis will still be with us in the spring, and beyond. A temporary rent freeze is a blunt tool that risks delaying rather than preventing homelessness, exacerbating our supply challenges next year.
“Instead, we’re recommending that an emergency evictions moratorium, as was seen during the Covid-19 pandemic, should be front and centre.”
During last week’s debate, however, the housing minister appeared to rule out another eviction ban.
“It just delays the point where people face mandatory evictions in the spring, for rent arrears that they find very difficult to pay back,” James said, calling instead for the UK Government to increase housing benefit in line with inflation.
“The UK Government needs to take immediate action on reversing their outrageous freeze on the local housing allowance,” she said.
“It is driving poverty in the sector and it does not help the landlords.
“The landlords would be better helped if the local housing allowance was at the right level as well.
“So, this is hurting everyone and helping no-one.”
A decision from the UK Government on benefits is not expected until the end of the month, but incoming chancellor Jeremy Hunt has already confirmed his intention to make further painful public spending cuts - telling MPs this week he will take "decisions of eye-watering difficulty".
Plaid Cymru’s position, meanwhile, appears unchanged.
“Labour in Wales were quick to condemn the Tories in Westminster for freezing the local housing allowance, but when they could take tangible action against the callousness of the UK Government, by freezing private rents, they voted with the Tories against the Plaid Cymru motion,” a spokesperson said.
“Freezing private rents and banning all evictions would prevent homelessness this winter and help protect our most vulnerable.
“Our communities didn’t cause this cost-of-living crisis, but it’s our most vulnerable that will pay the price for government inaction to combat it.
“The Welsh Government should focus on protecting the vulnerable, not the assets and incomes of the rich.”
The Welsh Government was approached for comment.
