Renters and Landlords Face Uncertainty Amid Silence From Parties on Housing Benefits Crisis

Millions of people living and working in the private rented sector face chronic uncertainty due to a failure by the main political parties to provide clarity on housing benefit rates.

Over 1.5 million households renting privately in Britain receive Universal Credit with support for their housing costs, known as the Local Housing Allowance (LHA), included. However, an analysis of government data by the National Residential Landlords Association (NRLA) suggests that, of this group, two-thirds (65 per cent, nearly one million households) experience a shortfall between their LHA payment and their monthly rent.

In April 2024 the LHA rate was once again pegged to the lowest 30 per cent of rents in any given area. This followed a freeze introduced in April 2020 which had caused benefit rates to be detached from market rents. According to the Institute for Fiscal Studies, this led to just five per cent of private rental properties being affordable for those in receipt of LHA.

Since then, the Institute for Public Policy Research has warned that even with the LHA rate unfrozen, over 800,000 households on Universal Credit will continue to face shortfalls between their housing support payment and the rent they pay. The picture is set to worsen given that LHA rates are due to be frozen from April 2025.

None of the main parties’ manifestos have pledged to permanently link housing benefit rates to the bottom 30 per cent of rents for the duration of the next Parliament. Failing to do so means they have ignored recommendations made by the cross-party Work and Pensions Select Committee, and leaves those living and working in the private rented sector struggling to plan for the future.

Ben Beadle, Chief Executive of the National Residential Landlords Association, said:

“It is time to fix the broken housing benefit system once and for all. The lack of clarity about support in the future is causing insecurity and anxiety for renters and landlords alike. It undermines efforts to sustain tenancies and prevent homelessness in the first place.

“The lack of any pledges to address this issue by the main parties is unacceptable. The next government must confirm that housing benefit rates will permanently track market rents. This would provide the assurances needed that support would keep pace with the cost of housing.”

EAN Breaking News

Breaking News from the team at Estate Agent Networking. Have a new story to share with us? Then please get in contact today! When and where we can we will refer to third party websites with a 'live link back' where news was released first.

You May Also Enjoy

Rightmove logo
Breaking News

Ten years on: More first-time buyers moving to cities while the coast stands still

New ten-year analysis of the property market shows that more first-time buyers are looking to move to cities, while the coast has seen no growth in new buyers First-time buyer demand to move to Great Britain’s 50 largest cities (excluding London) is up by 16% on average over the last ten years, with Dundee topping…
Read More
Breaking News

Homeowners in England and Wales overvalue their properties by an average of 16%

Homeowners in England and Wales are overestimating the value of their property by an average of 16%, according to new figures. Data from Quick Move Now compares homeowner estimates with formal estate agent valuations and is broken down by both region and property type. Overall, homeowners overvalue in every single category.   Regional breakdown Region…
Read More
Visual blemishes on Roads due to service upgrades
Estate Agent Talk

Emergency Sidewalk Repairs: When to Act and Who to Call

Sidewalks are the unsung heroes of city infrastructure—quietly assisting tens of millions of footsteps every day. But when they crack, disintegrate, or shift all of sudden, they might quickly turn out to be volatile liabilities. In a town like New York, in which pedestrian site visitors are constant and belongings proprietors are legally chargeable for…
Read More
Breaking News

Reapit report reveals agents’ long-term market confidence amid legislative challenges

Despite the significant challenges posed by a shifting economic landscape and the largest wave of housing legislation in decades, estate and letting agents remain steadfast in their confidence about their long-term future in the industry. According to the first Reapit Property Outlook Report 2025, covering the full breadth of sales and lettings agency opinion countrywide,…
Read More
Breaking News

Owner-Occupiers Drive Resilient Commercial Property Market

Buying Becomes 37% Cheaper Than Renting The latest Commercial Property Demand Index from specialist property finance expert, Rangewell, reveals that while investor appetite across the sector held steady in Q2, strong levels of owner-occupied commercial mortgage activity are helping drive market performance, as business owners increasingly move from renting to buying their long-term premises for…
Read More
Breaking News

One year of Labour: Property market performance review

Investors left waiting for planning reform and incentives but majority plan to increase real estate allocation   Biggest failures: Lack of incentives for developers and investors, and ineffective planning reform Top priorities: Planning reform, tax incentives, and attracting international capital Where opportunities lie: Data centres, warehousing & logistics, and later-life housing Real estate debt is…
Read More