How are Britons coping with housing costs: the implications for Shelter advice services? Housing Studies Association, York 2012 Catherine Davie Senior Research Officer

Who we are and what we do Current context and challenges How people are coping How Shelter is responding

Who we are, and our purpose Our vision Shelter believes that everyone needs a home in a place where they can thrive. Our work won’t stop until there’s a home for everyone. Our goal Our ambition for this strategy is to help more people in housing need than ever before.

What we do A national network of over 40 advice and support services Free housing advice helpline Online advice (shelter.org.uk/getadvice) National Homelessness Advice Service – second tier advice Specialist services promoting innovative solutions to particular homelessness and housing problems We also campaign for new laws and policies – as well as more investment – to improve the lives of homeless and badly housed people, now and in the future.

Current context and challenges

Unemployment is rising

Real earnings are decreasing

More people are living in overcrowded conditions

Homeless acceptances are now rising

Households in temporary accommodation are starting to rise

More people are claiming housing benefit

Private rents are rising

Any rise in interest rates risks putting a significant number of home owners under threat of arrears and repossession

Statutory funding for advice is being reduced £350 million cuts to the legal aid budget 595,000 cases cut, including 52,000 housing cases 40% of all legally aided housing advice to go 77% funding cut to the not-for-profit advice sector Plus local authority funding cuts to advice in addition

And demand for Shelter’s services is increasing   Visitors to Get Advice Q4 2010-11 429,921 Q4 2011-12 494,065

How are people coping?

How much are we spending on housing?

People are spending less on treats and luxuries, food and fuel to help meet housing costs

People have used savings, are saving less and are relying on credit to meet their housing costs In the 12 months to December 2011: 18 per cent of adults in Great Britain have used their savings to help meet their housing costs 16 per cent have reduced the amount they save 15 per cent (equivalent to 7 million adults) have relied on credit to meet their mortgage or rent payments

Using credit to help pay for housing 15 per cent of GB adults have relied on credit to meet their mortgage or rent payments with 8 per cent (equivalent to 3.7 million adults) borrowing money on a credit card, an increase of 38 per cent (equivalent to a rise of 1 million adults) since August 2010 6 per cent (equivalent to 2.9 million adults) going into an unauthorised overdraft 3 per cent (equivalent to 1.4 million adults) taking out another type of loan 2 per cent (equivalent to 936,000 adults) taking out one or more payday loans

More than a quarter of private renters are relying on credit to meet their housing costs

Of those borrowing on credit cards… You said you/ your partner borrowed on a credit card to help meet your mortgage or rent payments…In which of the following ways did you/ your partner use the credit for this in the last 12 months? (i.e. since Dec 2010)? (Please tick all that apply)   I/ we paid for other goods/ services on my/ our credit card so that I could use the money in my/ our current account to meet housing costs 66% I/ we paid for food on my/our credit card so that I/ we could use the money in my/our current account to meet housing costs 55% I/we paid for utility bills (including heating bills) on my/ our credit card so that I/ we could use the money in my/ our current account to meet housing costs 20% I/we got a cash advance (took out money on my/ our credit card from a cash machine) to pay our mortgage/ rent directly 16% I/we paid for phone bills (including mobile phone bills) on my/ our credit card so that I/ we could use the money in my/ our current account to meet housing costs 15% I/we transferred money from my/ our credit card directly to my/ our mortgage lender or landlord 3% Base: All GB Adults who have borrowed on a credit card to help meet their mortgage or rent 277

A quarter are only making minimum payments on their credit card bill 41 per cent (equivalent to 1.5 million adults) didn’t pay off the balance in full, but paid off the most they could afford each month and made at least the minimum payment 26 per cent (equivalent to 961,000 adults) only paid the minimum payment every month 14 per cent paid off the balance in full every month and 9 per cent paid off the balance in full most of the time 3 per cent (equivalent to 107,000 adults) didn’t make the minimum payment once or twice and a further 3 per cent (equivalent to 114,000) didn’t make the minimum payment 3 times or more

Significant minorities are using credit regularly to help meet their housing costs You said you or your partner has borrowed money to help meet your mortgage or rent payments...Thinking about the last 12 months (i.e. since Dec 2010), for each of the following, please indicate how many times you/ your partner did this Borrowed on credit card : Borrowed money from friends/ family : Gone into unauthorised overdraft Taken out another type of loan: % of GB adults 8% 6% 3% Once or twice 47% 54% 41% 71% 3 to 5 times 25% 27% 33% 10% 6 to 11 times 13% 7% More than 11 times (i.e. every month) 4% 12% 2% Can't recall 9% Base 277 297 214 105

Are people coping or struggling with housing costs?

Are people coping or struggling with housing costs? Who is struggling? Unemployed people Households with children 25-54 year olds Households on low incomes are struggling most (18%) but Households on up to £49,999 report average (9%) or above average levels of struggling

There’s little change in the extent of struggling since 2008

Renters are struggling more than mortgagors

But there’s still little change in the extent of struggling since 2008

Are people coping by using credit?

How is Shelter responding? Increasing the reach and extent of our advice services to help prevent housing problems Developing multiple channels for people to access advice in the way that best suits them investing in phone services/ telephony to answer more calls enhancing our digital offer, online tools etc marketing digital and face-to-face services

How is Shelter responding? Increasing digital services’ capacity and content

How is Shelter responding? Creating Shelter hubs to provide advice and support services in areas of greatest housing need Developing services for professionals so LAs and other bodies are better able to support those in need Looking to expand family support services Lobbying and influencing to protect face to face services

How is Shelter responding?

Senior Research Officer Housing Studies Association, York 2012 Catherine Davie Senior Research Officer