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Housing benefit freeze under pressure as rents rocket and calls grow for change
New analysis says unfreezing Local Housing Allowance would not drive a surge in private rents, as ministers weigh a £1.5 billion change.
- Government is evaluating whether to continue the Local Housing Allowance freeze from next April, as new analysis suggests unfreezing rates would not automatically drive up private sector rents.
- When introduced in 2008/09, LHA aimed to cover the 50th percentile of local rents; the system shifted to the 30th percentile in 2011. Average weekly rents across England increased from £192 to £250 between 2016/17 and 2024/25.
- Ben Beadle, chief executive of The National Residential Landlords Association, said: "Our analysis clearly shows that unfreezing housing benefit rates does not lead to an explosion in private sector rents." He noted that rents are influenced by mortgage rates and other factors.
- The Institute for Fiscal Studies estimates restoring LHA to cover the bottom 30% of rents would cost £1.5 billion annually. The Resolution Foundation reports this could lift 130,000 children and 215,000 adults out of poverty.
- Homelessness charity Crisis estimates fewer than 2% of private rental properties are affordable for benefit recipients. Government faces pressure to control spending while councils spent £2.8 billion on temporary accommodation in 2024/25.
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Unfreezing housing benefits will not drive up rents
New analysis suggests that unfreezing housing benefits would not drive increasing rents. It comes as ministers consider whether to continue freezing housing benefit rates from April next year. Successive governments have frozen Local Housing Allowance (LHA) rates in an effort to limit welfare spending. Most recently the Prime Minister, Andy Burnham, argued that the housing benefit … Continued
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Leaning Left0Leaning Right0Center14Last UpdatedBias Distribution100% Center
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