Rents are too high. A single person over the age of 21 on minimum wage of £6.50 an hour will earn around £1000 a month, less deductions. Even with the lowest rent prices, half of that will go on rent leaving around £120 a week for everything else.
Here’s a painless way to get rent down. It just needs some visionary people with a little capital to decide to do something about it.
Here is an example:
£60,000 invested in a building society or bank will be doing well to make 3% interest (although a ‘help to buy’ ISA can give 4%) e.g http://www.halifax.co.uk/savings/?WT.ac=SNCA1012
Therefore a good (4%) return on that £60,000 is £2400 a year, or £200 a month.
If we are happy with a 4% return on our savings, then why not but a property and rent it out at the same return?
The cheapest (1 bedroom) property available today is £395 a month. http://www.rightmove.co.uk/property-to-rent/property-56267795.html
There is a flat for sale in Rugby for £60,000. (http://www.rightmove.co.uk/property-for-sale/property-54091703.html?premiumA=true )
Using the £60,000 to buy the property, we could charge a very fair rent of (say) £250 a month, offering a low rental price and getting a very good return on the investment. (£250 instead of £200 to include an allowance for maintenance and fees)..
This represents a saving of a third on the lowest rental cost, and would give someone on low income the chance of an improved standard of living, and maybe even the chance to save enough to put down a deposit on a house of their own.
And all of this giving the same (or better) return that we get from the building society. Maybe there is a little more risk – but there is the benefit of doing something personally to help the current difficult situation for the poor in our town.
If enough of us do this, then it might even cut the overall rental market price (supply and demand!) with wider benefits. I know that not everyone can help in this way, but some can, and it makes a difference to each person who is helped.
If you are interested and want to take it further, I’m happy to share my experience so far (I have made use of a legacy from when my mother died to do this). Please get in touch privately.