Blog

Rents across England continue to rise as the numbers of households in temporary accommodation across the country are at a record high.

Meanwhile, the amount of housing benefit private renters can claim – the Local Housing Allowance (LHA) – remains frozen – as it has been for most of the past decade.

Housing sector organisations, including landlords and homeless charities, are urging the government to unfreeze LHA, fearful that it’s driving more renters into homelessness.

Artist Esther Planas, 65, rents a one-bedroom flat in Hackney, east London and claims Universal Credit (UC).

She fears she is just one small rent rise away from homelessness.

“It’s like you’re in quicksand. Nothing is stable under your feet. Things mutate all the time. Rents are crazy, and nothing is out there to protect you.”

In 2023, Esther applied for homelessness after her landlord tried to rise her rent by £500 a month, which she couldn’t afford.

Hackney Council mediated and the rent rise was reduced to £200 a month – something Esther’s local housing allowance only just covers – but she fears it could happen again.

“I am really scared because for the moment, they’re letting me be… [but] if my rent was risen again I would have to claim homelessness.”

The Resolution Foundation think tank estimates that Hackney has the largest cash shortfall in London – at £350 a month – between the Local Housing Allowance rate and local rents, according to analysis of the latest data.

The foundation’s analysis omits four boroughs with the highest rents – which are calculated differently – and some boroughs don’t fall cleanly into LHA boundaries.

Forty organisations have sent a joint-sector letter to the government, calling for LHA rates to be unfrozen.

Alice Walker, Shelter’s assistant director of activism and advocacy, says “people have to choose between eating and having a roof over their heads. There are far too many people stuck in temporary accommodation because they can’t afford to pay their rent.”

According to research by Crisis, as of November 2024, almost half (48%) of the 1.6 million private rented households in receipt of UC had a shortfall between the support they received and their rent, and fewer than three in every 100 privately rented properties listed in England were affordable for people on housing benefit

Jenna Fassa from Hackney Food Bank says the increasing shortfall between LHA and local rents is driving more people to use their services.

“We see a large number of working people. It’s not unusual for us to see professions like nurses, the occasional firefighter, policemen – key-worker roles who can’t afford the rents in Hackney.

“It’s not unusual for our visitors to be living in mouldy, damp and draughty conditions or small buildings where there isn’t enough space.”

The National Residential Landlords Association has also joined calls to unfreeze the LHA rate.

Chief executive Ben Beadle said: “If the government is serious about improving access to rented housing, it has to unfreeze the Local Housing Allowance. It cannot be right that a system designed to support rental costs is failing to reflect rents as they actually are.”

However, renters’ groups including the Renters’ Reform Coalition are calling for the government to focus on capping rent increases.

Jae Vail from the London Renters Union warns that “we cannot allow private landlords to profiteer and collect billions more pounds of public money every year”.

LHA rates were increased to the 30th percentile of local market rents in April 2024, at a cost of about £7bn over five years across Britain.

A spokesperson for the government said it was tackling rising rents and the housing shortage with its commitment to build 1.5 million homes, including “the biggest boost to social and affordable housing in a generation.”

“We’re also putting more money in people’s pockets by uprating benefits, making Universal Credit deductions fairer, and helping people move out of poverty and into good, secure jobs as part of our Plan for Change.”