As a nurse in a busy accident and emergency department, Lee Walker is used to stress. But now, on top of his punishing 12- or 13-hour shifts at St Thomas' hospital, south London, he faces a new worry. For Walker, who has worked at the hospital for 10 years, is one of more than 300 tenants facing eviction from their subsidised housing as part of plans to slash the amount of staff accommodation on site. "On a personal level, it's quite a major trauma – it feels like we are almost expected to pay for having a job," he says. "The wages we get are so out of sync with housing costs. The accommodation we have now is by no means luxurious, but it is important to us."

Under the plans, two buildings owned by the Guy's and St Thomas' charity and managed by the hospital's NHS trust, are to be redeveloped as student accommodation – cutting the staff homes available in the vicinity of the hospitals by a third. Guy's and St Thomas' NHS foundation trust explains that the changes follow a property review driven in part by the need to move a facility for the parents of seriously ill children. It insists it is offering support to staff to find new homes and is looking at providing loans to help them with deposits that will help them to rent in the private sector.

But nurses fear they will not be able to afford rents in the area, which, according to figures from the Mayor of London's office, stand at an average £1,430 a month for a one-bedroom flat – more than many nurses earn.

Bobby Gangar, an accident and emergency nurse who has worked at the trust for 15 years, pays £450 a month rent for hospital accommodation from his monthly take-home pay of between £1,100 and £1,200. "I have written to housing associations and been to see the council, who have said I am in the lowest [eligibility] band and they can't help. I am being told to look at the private sector, but it's so expensive in London. Even if I could find somewhere at, say, £800 per month, after bills that would not leave me much to live on," he says.

What is happening at Guy's and St Thomas' is not an isolated case. Much NHS accommodation has been sold off over the last few years – and what remains is increasingly being eroded as NHS trusts seek to rationalise their assets.

In Epsom, for example, Surrey and Borders Partnership NHS foundation trust issued eviction notices before Christmas to the remaining staff living in the last on-site flats and houses it has closed. Resources, the trust said, would be better spent on quality healthcare services, rather than maintaining properties with vacancies.

In north London, union officials at Unison are dealing with ongoing evictions of the remaining staff from Barnet, Enfield and Haringey mental health trust who are living in homes on the Chase Farm hospital site. Those facing eviction include a nurse who has been in her home for 29 years.

According to Derek Hellyar, Unison's regional officer, she was offered a deal to stay – but the condition was a rent rise from £460 a month to £1,260, or around £200 more than she takes home each month. The trust says continuing to provide the accommodation "wasn't sustainable given the cost and largely underused facilities". In a statement it says: "The handful of remaining people were given the opportunity to stay under a revised rent agreement but refused. Chase Farm has subsequently served eviction notices. It's a difficult situation but we have tried to reach a compromise which balances the need for cheaper accommodation with the huge savings programme the NHS is undergoing."

Financial hardship

According to the Royal College of Nursing, much of the old-style single room NHS accommodation that has been phased out over the years just didn't meet modern expectations. But in the absence of such low-cost options, nurses are often facing serious financial hardship as they struggle to meet their housing costs. "We have been taking up an increasing number of cases of debt and financial problems as a direct result of housing taking up such a large part of nurses' salaries," says Claire Cannings, senior welfare adviser at the RCN. "Increasingly, we are seeing nurses spending over 50% of their salary just on accommodation, especially in London and the south-east."

NHS staff have been encouraged to take advantage of schemes for public sector key workers, such as nurses and teachers, run by housing associations, which offer a range of options including rented properties and shared ownership. But Cannings says nurses with children are particularly hard hit by the problem of finding affordable accommodation, which, in the case of flats at "intermediate" rents (below market rates) for key workers is often aimed at single people.

"If you are a single person with two children, that intermediate rent avenue is closed," she explains. In addition, nurses who are working are not a priority for council housing, she points out. "The only avenue that's left is often the private rented sector, which is very expensive and will take a very, very high proportion of their salary," says Cannings.

Research by the housing charity Shelter has shown that private rents are already unaffordable to those on average incomes in 55% of local authority areas. Closing down more NHS accommodation will add to the pressure, claims Shelter's head of policy, Toby Lloyd. "Pushing more people into the [private] sector can only increase competition for homes and drive up rents further, especially in high-value areas like inner London," he says.

"If we want people to work night shifts for modest wages in London's hospitals they have to be able to live nearby in homes that are affordable for them. Selling off NHS homes might raise money in the short term but it will ultimately increase the pressure on NHS wages, or lead to staff shortages."

Some housing associations have been bucking the trend by working with NHS trusts to bring old hospital properties up to scratch. A2Dominion Group offers a range of refurbished homes and new-build properties on hospital sites across London and the south – and it insists demand is strong. "We have got a mix of different kinds of accommodation, from single rooms in what would have been nurses' homes with shared communal facilities like kitchens and bathrooms right through to three-bed family houses," says the group's regional housing manager Tanya Reddick.

"They are still very much in demand because of the rents, which offer good value for money, especially in areas where private sector rents are high. People also like living on site, as they don't want to have to travel too far."

Those are the very reasons that staff at Guy's and St Thomas' say they value their accommodation so much.

"[For] a major central London trust to not offer accommodation to employees when other rents are so high, they are going to shoot themselves in the foot," says Gangar. "People are not going to be able to face commuting on top of a 12-hour shift in A&E. It's stressful enough when you're here without that."

In a concession to staff, Guy's and St Thomas' trust last week negotiated a revised arrangement with the charity that owns the staff accommodation. Tenants were initially told they would have to leave by April or May this year, but one of the buildings will now stay open for a further 12 months. The trust says this will "enable its accommodation team to do more to help the residents".

But in the long term, Walker says the lack of subsidised housing could have a knock-on effect on the running of departments such as accident and emergency. "We could have a mass exodus [of staff] and that could impact on public health and wellbeing," he warns.