The government is urged to use the Spring Budget to rectify a huge gap in support for tenants in the private sector, created by decisions in the Autumn Spending Review. Analysis by the Chartered Institute of Housing (CIH) for the 2023 UK Housing Review highlights the impact of the government’s decision not to raise local housing allowances (LHA) to reflect the true cost of renting.

LHA rates are limited by legislation and based on private market rents paid by tenants in a broad rental market area (BRMA). They were restored to the 30th percentile rent (to cover the cheapest third of rents) in April 2020 in response to the pandemic (after eight years of failing to fully uprate in line with local rents) but have since been frozen.

CIH analysis of the Valuation Office Agency list of rents shows that in April 2022 (the latest data available), the LHA shared rate covered just ten per cent of rents or less in seven out of every ten local markets (BRMAs). For every category of dwelling, at least one in five BRMAs had fewer than 20 per cent of homes available within the LHA rate. The rapid erosion in the shared accommodation rate is particularly alarming, with nearly nine in every ten BRMAs having fewer than 20 per cent of homes available, and in one in every ten there are no shared properties at all within the LHA rate.