The study, published on Monday in the Journal of Public Health, finds that worries around debt, rent arrears and the prospect of being forced to move from their family home produced a sense of "hopelessness verging on desperation".
They reported being trapped in a "vicious cycle" of loneliness and isolation; they could often no longer afford to go to the pub or cafe, or even carry out family roles such as grand-parenting.
Contrary to the government's assertion when the policy was introduced in 2013 that it would have no negative impact on health and wellbeing, the study concludes that the bedroom tax has "increased poverty and had broad-ranging adverse effects on health, wellbeing and social relationships", The Guardian reported.
Although it was too early to establish the long-term health effects on tenants, it says that the perceived adverse effects of the bedroom tax - coupled with other welfare cuts, such as the removal of council tax benefit and tax credits - were likely to result in a greater demand among residents for family doctor and mental health services.
It states: "Worries about potential re-location, not being able to provide healthy food for themselves or their children, living in inadequately heated homes and spiralling rent arrears contributed to mental health problems.
"All participants reported feelings of stress, many recounted symptoms of anxiety and depression, and service providers observed that these were widespread throughout the community."
The government of Prime Minister David Cameron has said that it was simply removing the "spare room subsidy" which put social sector tenants in a better position than those in the private rental sector.
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