Only 2.5% of private rented properties listed in England were affordable for people on housing benefit between April and October last year according to Crisis, down from 12% in 2021 to 22.

As housing benefit rates are frozen today until 2026, the charity warns this will push more people out of the private rented sector and into homelessness, piling further pressure on local authorities whose temporary accommodation bill already stands at £2.3billion.

Difficult financial choices

The freeze means households that rely on housing benefit to pay their rent will see a real terms cut in the amount of support they receive, making them even more likely to face difficult financial choices to meet rent costs, be pushed into arrears or even forced into homelessness, says Crisis, which conducted the research with Health Equals.  

It said linking benefits to rising rents would help to reduce poverty, prevent homelessness and improve public health.

Matt Downie, of Crisis, believes this isn’t just a difficult situation for private renters on low incomes, it’s an impossible one.

“There is no doubt that today’s freeze on housing benefit will lead to rising homelessness,” he said.

“It also risks completely overwhelming local authorities who are already struggling to cope with the demand for support and will leave more people stuck in unfit temporary accommodation that damages their health and wellbeing.”

Other renter and landlord groups have also called for the Government to unfreeze Local Housing Allowance (LHA) including the National Residential Landlords Association, which believes rates should be pegged to market rents.

It reports that more than 1.5 million households renting privately in Britain receive LHA but that two thirds of claimants were experiencing a shortfall between their payment and their monthly rent last year.

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