New analysis reveals that London boroughs collectively spent £114m every month on average – or £4m daily – on temporary accommodation for homeless Londoners in the 2023-24 financial year [1].

The figures also show boroughs’ spending on temporary accommodation jumped by a dramatic 68% in just one year (comparing 2022-23 to 2023-24) [2].

London’s Homelessness Emergency, a new report published by the cross-party London Councils group, stresses that homelessness in the capital is at record levels and that the current situation is “utterly unsustainable”.

London Councils’ report also highlights:

More than 183,000 Londoners are estimated to be homeless and living in temporary accommodation arranged by their local borough [3]. This is the highest-ever level of recorded homelessness in the capital – equivalent to at least one in 50 Londoners.

The number of Londoners in temporary accommodation includes almost 90,000 children. London Councils estimates this is equivalent to one out of every 21 children living in the capital and means on average there is at least one homeless child in every London classroom.

The shortage of suitable accommodation means boroughs are increasingly reliant on placing homeless families in B&Bs. Over the past two years there has been a 662% increase in families placed by London boroughs in B&Bs.

Rough sleeping has also grown significantly in the capital. In the ten years since 2014, rough sleeping has spiralled by 58%.
Ahead of the government’s Budget on 30 October, London Councils warns that skyrocketing homelessness numbers and associated costs represent the fastest-growing risk to boroughs’ financial stability – with several boroughs edging closer towards effective bankruptcy.

London boroughs are forecast to overspend on their original homelessness budget plans by £250m this year. Across all services (not just relating to housing and homelessness), London Councils has warned of a £700m funding gap next year [4].

Cllr Grace Williams, London Councils’ Executive Member for Housing & Regeneration, said:

“The homelessness situation in the capital is nothing less than an emergency. London is the epicentre of a national crisis – we are grappling with the most severe housing and homelessness pressures in the country.

“Homelessness is an injustice and has a devastating impact on individuals and families, undermining Londoners’ health, wellbeing, and opportunities. As these figures show, it also brings utterly unsustainable costs to councils. Without urgent action, homelessness pressures will break London boroughs’ budgets.

“We welcome the government’s commitment to tackling homelessness and to building the affordable housing our communities need. Boroughs are relying on the upcoming Budget to bring renewed support for local homelessness services and policies to reduce homelessness as quickly as possible.”

London Councils’ priorities for national policy action include:

Double Homelessness Prevention Grant funding. Local authorities play a vital role in supporting struggling households to avoid homelessness. Councils require an emergency funding increase to ensure local services have the resources needed in the face of rising levels of demand for support.

The current level of overspend on borough budgets suggests a doubling of Homelessness Prevention Grant funding is necessary. London boroughs received £157m from the government through this grant in 2024-25.

Make the increase in Local Housing Allowance rates a permanent measure. Research recently published by London Councils shows only 5% of London’s private rental listings in the capital are affordable to households relying on Local Housing Allowance [5].

Boroughs are calling for the increase in LHA rates to become a permanent measure, with LHA rates updated annually to track market rents and help ensure adequate support for low-income tenants in the private rented sector.