New research from the Chartered Institute of Housing (CIH) shows that more than 90% of Local Housing Allowance rates across Great Britain now fail to cover the cheapest rents.
The CIH is warning that rates have now fallen so far behind that private renting has become unaffordable for most low income tenants – putting them at risk of homelessness as they are forced to choose between basic living expenses and paying the shortfall. The organisation is now calling on the Government to review the policy and to end the freeze immediately – something the Residential Landlords Association (RLA) has also been campaigning on for some time.
LHA rates are meant to cover the cheapest 30% of homes in any given area, but they haven’t increased in line with local rents since April 2013 and they are set to remain frozen until April 2020. As a result, renters are facing gaps ranging from £25 a month on a single room in a shared home outside London to more than £260 a month on one to four-bedroom homes in some areas of the capital.
Over 12 months, those shortfalls can total over £3,000 – making it increasingly likely that renters will be forced to choose between paying for basic necessities like food and heating or their rent.