As the Renters Rights Bill reaches Report stage, more attention is rightly turning to the 19% of UK households renting privately. The rising financial cost of rent is well known. But a deeper, often hidden cost is going uncounted: the toll renting takes on people’s wellbeing.
New analysis from PBE’s Caught in a Trap report shows that the way we rent is quietly undermining wellbeing. Using the latest data from the English Housing Survey and Understanding Society, we find that renters are three times more likely than homeowners to be in “wellbeing poverty”—defined as rating life satisfaction 4 or below out of 10 on the ONS scale.
Renters are more likely to have persistently low life satisfaction than homeowners. One in 10 (10%) renters find themselves in this position. The question is, to what extent is this down to the experience of renting? Or is it simply that, due to other demographic and economic factors, people who experience low wellbeing are more likely to be renters?
The hidden cost of private renting
Renters in both social and privately rented homes face real challenges, but the data shows the link between wellbeing, poverty and housing is particularly pronounced in the private rented sector. Social renters also often report low life satisfaction, but much of this is closely tied to individual factors like poor health, low income or disability.
Even after accounting for the same demographic, economic and health characteristics, private renters are still more likely to experience wellbeing poverty. This suggests private renting itself carries a wellbeing penalty—something about the experience makes life harder.
This wellbeing penalty affects 4.6 million private renting households and is valued at around £3,700 per person per year, using Treasury wellbeing valuation methods.
The wellbeing penalty for private renting
The primary drivers of the wellbeing penalty for private renters are affordability, quality and insecurity. Private renters spend an average of 39% of their income on housing, far more than social renters (29%) or homeowners with mortgages (20%). Given that rents have risen by 18% over the past five years, this pressure shows no signs of easing. For many, this means constant financial stress, limited choices, and a reduced quality of life. Affordability concerns explain around two-fifths of the private renting wellbeing penalty.
Our analysis suggests that, based on new modelling, the number of people in England likely to be experiencing low wellbeing is around 110,000 higher among private renters than it would be if they had the same wellbeing outcomes as similar people in other housing tenures. As more households are pushed into the private rented sector, this gap may grow, along with the cost to the nation’s wellbeing.
Insecurity is another key factor. Nearly 40% of private renters have lived in their homes for less than a year, and many remain at risk of “no-fault” eviction under Section 21. Millions remain vulnerable to losing their homes with just two months’ notice, making it harder to plan, build community, or feel truly settled.
Scotland shows a potential way forward
Fixing our housing crisis requires long-term, system-wide solutions. However, reforming renting here and now can deliver meaningful change. Scotland, where reforms have been in force since 2017, including the introduction of open-ended tenancies and stronger protections against rent increases, shows what’s possible. Since then, the wellbeing penalty for private renters has improved. If these improvements were entirely due to the reforms, their value could be as much as £4 billion annually. Changes to housing policy can significantly improve people’s quality of life.
England can follow suit. The Renters’ Rights Bill will abolish Section 21 evictions, improve protections, and allow renters to challenge unfair rent hikes. If implemented well, it could lift 50,000 people out of wellbeing poverty and improve life for many more.
The Bill alone isn’t enough. Without proper enforcement from already stretched councils, rights risk being paper promises, and issues with affordability in particular may persist.
Affordable private renting is the next step
Homes are the foundation of our wellbeing. They shape whether we feel secure and supported. The case for housing reform goes beyond market efficiency to dignity, fairness and quality of life.
Big problems like Britain’s housing crisis demand big solutions that take time to deliver. Focusing only on the long-term can risk leaving today’s renters behind. As Scotland’s experience shows, meaningful reform to the rental market can improve people’s lives now, while we work towards the systemic change the housing market needs.
The Renters’ Rights Bill offers an opportunity to reduce the insecurity and stress of millions of renters. But we need to think not just about legislation, but about enforcement, support and affordability.
That’s why PBE is exploring how to make private renting more affordable, and we’re looking for collaborators to support this work. Real progress is possible in the short term as well as the years to come and requires political will to grab opportunities to fix renting and improve lives.