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Renters and landlords face perfect storm as benefit freeze bites

Over 820,000 private rented households in Britain experience a shortfall between their housing benefit payment and their monthly rents. 

Official data shows that of all private rented households in receipt of the Local Housing Allowance over half (57%) have a shortfall. This amounts to just over 820,000 households. 

Regionally, the proportion of private rented households affected ranges from almost 41% in London (although based on a much higher number of claimants), through to 69% in Wales. 

The figures come as the Office for Budget Responsibility has warned that housing-related benefits spending is expected to rise by just 0.1% of GDP by 2025 – five years on from the start of the pandemic and the recession it caused. It notes that this is the smallest increase seen in any of the four recessions seen since the early 1980s. 

Despite private rents increasing by less than inflation, the National Residential Landlords Association (NRLA) is warning that vulnerable renters face a perfect cost of living storm. It is being worsened by housing benefit rates having been frozen since April 2021, rising energy and food prices and a chronic shortage of private rented housing which is set to drive up rents.

Amidst the cost-of-living crisis, the NRLA is calling on the Government to unfreeze housing benefits rates to provide tenants and landlords with the security that rents can be paid.

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