Homeless in the recession

Ian Paul Editor Politics Show South

One of the things that people were worrying this recession would produce was a rise in homelessness.

The latest figures would tend to suggest that has not been the case - if anything, it seems to have fallen slightly.

The number of people at risk of being made homeless in the recession is on the rise, and it could now happen to almost anyone

And the Council of Mortgage Lenders recently shaved 10,000 off its original prediction of 75,000 house repossessions in 2009.

Even so, it would probably be a mistake to assume that the problem has been solved.

In May 2009 housing charity Shelter was warning the government that we could be looking at a second wave of arrears and repossessions hitting the UK in the next couple of years.

The charity has seen a 250% increase in the number of calls to its free helpline asking about mortgage arrears.

Queries on repossessions are up by 85% compared to 2008.

And whatever the Council of Mortgage Lenders may be predicting, the actual figures from the Financial Services Authority show repossessions are up 62% over the last year, and there has been a 33% rise in arrears.

Perfect storm?

In amongst all that blizzard of statistics are we seeing the beginnings of a perfect storm combining growing unemployment, rising interest rates over the next year and the ending of mortgage support schemes?

These could all be swirling together to put hundreds of thousands of us at risk of being repossessed or falling behind with the payments.

Certainly that is what Shelter fears.

With many households just about keeping their heads above water, all it would take would be an unexpected hike in the interest rates, or being made redundant, to push them under.

The "hidden homeless"

The drop in the official number of homeless people also conceals a rather different tale.

According to the latest figures for Statutory Homelessness, which cover January to March 2009, the number of households meeting the criteria dropped by just over a quarter compared to 2008.

However, according to the charity Crisis, this is misleading.

Are the figures on homelessness misleading?

For a start, official statistics underestimate the real level of homelessness.

Not everyone who is homeless and approaches their local authority gets help or a place to stay.

Many others, they claim, never even approach the authorities in the first place as they either know they will not be helped, or do not know that help is available.

So on that basis Crisis reckons there may be as many as 400,000 "hidden homeless", people the statistics simply do not count, existing out of sight in hostels and refuges, bedsits or night shelters, or couch surfing with friends and family.

Policy problems

All of which certainly poses problems for policy makers.

What should they be doing to deal with what may be a large number of uncounted homeless people?

What can they do to prepare against a possible second wave of repossessions and arrears?

And are the things they are doing right now actually working?

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