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Renting a one-bedroom flat is unaffordable across roughly half of England for new nurses, teachers and NHS healthcare assistants, according to the charity Shelter, highlighting the severity of the country’s housing shortage.
Rent for an average one-bed property would take up more than 30 per cent of gross pay for a newly qualified nurse in 45 per cent of English local authorities, 43 per cent for teachers and 69 per cent for healthcare assistants, according to analysis of official data by the homelessness charity.
Spending more than 30 per cent of gross pay on housing is defined as “unaffordable” by the Office for National Statistics.
The findings highlight the challenges faced by many workers entering critical public service roles in finding a place to live across swaths of the country, notably in London and the South East, where a lack of supply and strong demand have sharply pushed up prices.
The supply of affordable housing — a broad category that includes schemes such as shared ownership, as well as social rent properties provided by councils and housing associations at government-controlled rents — is expected to fall across the country, largely because of high interest rates and rising construction costs.
In an open letter on Thursday, 40 economists, including four Nobel laureates, called on Rachel Reeves to prioritise spending on affordable housing in next week’s Spring Statement and the spending review in June.
“History shows you will not end homelessness or deliver new homes on the scale you have promised solely through planning reforms and the private market,” the signatories told the chancellor, in a letter co-ordinated by Shelter. “Government must prioritise investment in social homes and capitalise on the economic benefits this would bring.”
Reeves is under pressure to rein in government spending and is expected to trim proposed long-term budgets for Whitehall departments next week.
But she is facing a push by Angela Rayner, deputy prime minister and housing minister, to ensure enough funding for the government’s housebuilding agenda.
Ministers have promised the biggest boost to affordable housing in a generation, alongside 1.5mn new homes in the current parliament.
The UK has not recorded this level of new housebuilding since the 1960s, when the public sector built more than 100,000 affordable homes annually.
Some 62,000 affordable homes were completed in the year to March, including dwellings built by commercial developers as part of their planning obligations, according to official data.
Figures on housing starts suggest supply will decline in the coming years, with a particular crunch in London, amid a wider housebuilding slowdown and growing financial pressures on housing associations.
The number of social homes has been in decline as demolitions and Right to Buy sales outstrip construction.
The Ministry of Housing, Communities and Local Government said it had “inherited the worst housing crisis in living memory with rent levels unaffordable for far too many, including public sector workers”.
The government is bringing in rental legislation that will give new rights to challenge rent increases and has added £800mn to the current programme of grant funding for affordable homes, which ends next year. It now needs to agree the scale of a new multiyear funding programme.
Campaigners have said ministers could, by building more affordable homes, save money in the long term through both wider economic benefits and the direct reduction in housing benefits and temporary accommodation.
Cath Webster, chief executive of Thriving Investments, which invests in low-cost housing, said that “beyond just [giving] more grant”, the government could boost private investment by extending its proposed five-year rent settlement for social housing to cover a decade or more.
