Rent rises 'push families to edge'

Tenants are resorting to "drastic" measures such as using payday loans and dipping into their children's savings just to hang on to their homes, a charity has warned.

Shelter is calling for greater stability to be built into tenancy contracts so that families are not forced to make "impossible choices" due to unpredictable rent increases.

The charity said that calls to its helpline about rent increases or arrears have risen by almost one third over the past year.

Almost two thirds (63%) of 4,300 people living in privately rented housing in England who took part in a Shelter survey said that they are struggling to pay their rent or have fallen behind.

One quarter (26%) said they have had rent increases in the last year, with annual rises averaging £300 as wages remain stagnant.

Shelter said that one in 12 renting parents have been so desperate that they have been forced to borrow cash from their children to cover their bills, while one in 33 have taken out a high-interest payday loan to cover their rent costs.

One in seven renters have used a credit card to pay their rent and one in 17 have had to leave their rented home because of a rent rise, equating to almost 515,000 people across England.

Rents have soared as many would-be home buyers have remained trapped in the rental sector because they have been unable to raise the 20% deposit typically demanded or meet lenders' borrowing criteria.

There have been some signs of hope for aspiring buyers in recent months, with studies reporting uplifts in mortgage lending following the introduction of a Government scheme last August to unblock the housing market. However, these figures are still way below levels seen before the financial downturn.

Campbell Robb, chief executive of Shelter, said that renters should be given contracts which do not allow above-inflation rent increases.