William Eichler 27 June 2023

Newly listed properties unaffordable to benefit recipients

Newly listed properties unaffordable to benefit recipients image
Image: William Barton / Shutterstock.com.

The proportion of newly listed private rental properties on Zoopla affordable to recipients of housing support has dropped from 23% to 5%, according to the Institute of Fiscal Studies (IFS).

The think tank says this is the result of the freeze since April 2020 in the local housing allowance rates and the rising rents for new lets, which have gone up by more than a fifth on average.

IFS warn that the reduction in affordability of housing in the private rented sector could lead to demand for affordable properties far outstripping supply.

Tom Wernham, research economist at IFS, said: ‘With housing support frozen and falling well behind rents, only 1 in 20 newly listed private rental properties could be covered by housing benefit.

‘And the properties that are covered by benefit rates are of lower quality and more expensive to heat than the average. If these benefit freezes are maintained, private rents will become increasingly unaffordable for those on low incomes.’

Darren Baxter, principal policy adviser at the think tank Joseph Rowntree Foundation (JRF), said: ‘Private renters on low incomes are seeing the number of properties they can afford shrink dramatically as housing benefit fails to keep pace with soaring rents. Clearly, the government’s freeze on local housing allowance (LHA) is unsustainable.

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