Samuel

Crisis on top of crisis

There’s the energy crisis, the cost-of-living crisis, the housing crisis. But people don’t experience them in isolation; they stack on top of each other and interlink to trap people in cycles of hardship it’s very difficult to get out of.

Like many others, this is the case for Samuel.

Samuel lives with his young child in the south of England. He’s a single parent, so solely responsible for the household income and bills.

He works nearly full time as a keyworker, but the rising cost of living means that his earnings are not enough to cover their essential living costs. Every month Samuel is in a negative budget, he builds up more and more debt — just by surviving.

Amongst our debt clients who work full time, nearly 39% are in a negative budget. Single parents are deeper into the red than couples with children, who are just about keeping their head above the water.

A limited lifeline

When Samuel came to us for help we looked in depth at his budget and circumstances, and explored his options. We suggested he might be eligible for Universal Credit and gave him advice about how to deal with his debts.

Getting the right advice and support could be the difference between staying afloat and getting further into the red. That’s why our advisers continue to provide a lifeline for people during extreme hardship.

But more often than not, social policy failures make our advisers’ job almost impossible. Half the people we help with debt advice remain trapped in a negative budget — even after being helped by an adviser.

Even in circumstances like Samuel’s where advisers can find extra income, there are often still significant barriers in the way of pulling themselves out of the red. One of these policy failures is the lack of secure and affordable housing.

A one sided contract

Samuel and his child live in a private rented property. For several months, there have been serious disrepair issues in their home which weren’t being fixed. At one point, this led to a serious structural issue with the property that left the home dangerous and without heating. Despite repeated requests, it took the landlord 3 weeks to fix the issues and Samuel wasn’t offered alternative accommodation, forcing him and his child to live in a cold and unsafe home for nearly a month.

Because Samuel wasn’t getting anywhere with the landlord to address the repairs and their home was inhabitable, he withheld rent for 1 month. In response to this, and Samuel’s complaints about the disrepair, the landlord issued him a Section 21 notice or ‘no fault’ eviction.

Time to balance the scales

Landlords have a legal obligation to ensure the home they let is safe, maintained, and fit for human habitation. Despite this, Section 21 makes it very easy for landlords to retaliate to maintenance requests or tenants’ assertion of their rights and evict them from their home with no comeback — even if they haven’t fulfilled their end of the bargain.

Poor quality housing and the insecurity which Section 21 creates for families contributes to the current housing crisis. Decision makers and government need to address this and the unequal power balance between renters and landlords urgently, not least through progressing the Renters Reform Bill through Parliament and banning Section 21 in a timely manner.

Priced out

Samuel is now looking for a new home in the private rented sector but is finding that many letting agents and landlords are turning him away because of his debts. This is regardless of the fact he works nearly full time and is acting to repay his debts. The ability of landlords to pick and choose tenants makes it difficult to secure accommodation, especially for those in debt or receiving Universal Credit, contributing to the current housing crisis.

If Samuel is accepted by a landlord, it’ll be hard to find a home that’s affordable. One of the cheaper 2 bed properties in his area will be 50% of his salary, so will stretch his budget and leave very little room for any unexpected expenses, like school trips or new school uniform.

He’ll also likely incur significant expenses in moving his belongings, and making sure that the new place is fit for purpose for him and his child, potentially pushing him further into debt.

Samuel isn’t alone. There’s an affordability crisis in the private rented sector with rising rental costs and frozen Local Housing Allowance (LHA) meaning people are spending more and more of their income on rent. LHA will be realigned with market rates in April which will be a great help to renters, but this can’t come soon enough.

Housing is considered affordable if it takes up 30% or less of your income. Among our debt clients, social renters are currently spending just over this, but private renters are spending nearly 40% of their income on rent, leaving very little left over for all other essential costs. For Samuel it’s worse — he’s currently spending nearly half his current income on rent.

Structural racism in housing

Samuel is a person of colour and for many renters, these affordability and security issues in the Private Rented Sector are underpinned by deeper structural inequalities. We know there are racial disparities in housing — and the cost-of-living crisis — with more racially minoritised people living in private rented properties. Therefore, people of colour are more likely to experience the disrepair and insecurity issues highlighted above than white people.

Our data shows that people of colour are disproportionately receiving a higher number of Section 21 notices and are more likely to be homeless or at risk of becoming so than white people.

There are clearly deep rooted structural inequalities in housing which any housing policy must take into account and seek to address.

Samuel’s story highlights that, although advice services and charities like Citizens Advice can make a great deal of difference in people’s lives, they can’t solve everything. These systemic issues in the private rented sector pose a barrier to people trying to get out of a bad situation and can often take their situation from bad to catastrophic. The government needs to step up and fix the big issues we’re facing in 2024: housing, negative budgets, and the rising cost of essentials like energy.