Half of private renters on benefits face rent shortfall
Almost half of all private renters in receipt of housing benefits experience a shortfall between the support they receive from government and their monthly rents.
That’s according to a new analysis by the National Residential Landlords Association (NRLA) ahead of a planned freeze of housing benefit rates in April.
According to the most recent data on the Department for Work and Pension’s StatXplore portal, as of November 2024 more than 1.6 million private rented households were in receipt of Universal Credit with a housing cost support element - Local Housing Allowance (LHA) - including in the payment .
Of this group, 772,731 households, 48% had a gap between the housing cost support their received and their monthly rents.
In a letter to Work and Pensions Secretary Liz Kendall MP, the NRLA points to figures from the Institute for Fiscal Studies indicating that the last time LHA rates were frozen in 2023, only five per cent of rental properties were affordable to those claimants in receipt of LHA, claims echoed by the National Institute of Economic and Social Research last week.
According to the Joseph Rowntree Foundation, freezing LHA rates for the duration of this Parliament will see 50,000 renters fall into poverty, 60,000 will be pushed into deep poverty and 80,000 will be pushed into very deep poverty.
The figures come at a time of intense competition for rental housing with data from Zoopla showing that there are now an average of 12 tenants chasing every available home to rent.
The NRLA warns that freezing LHA rates will serve only to undermine the ability of claimants to prove their ability to sustain a tenancy, particularly amid intense competition for a limited supply of rental homes.
It is calling for rates to be re-pegged to at least the lowest 30 per cent of rents for the duration of this Parliament.
NRLA Chief Executive Ben Beadle said: “It beggars belief that ministers are making it harder for those reliant on housing benefits to sustain their tenancies, especially in an already fiercely competitive rental market.
“Tenants shouldn’t be expected to endure the uncertainty of not knowing what support they can access from one year to the next. It is time to end the insecurity they face and unfreeze housing benefit rates.”
