“Across Britain, people on low incomes are facing an impossible situation,” said Matt Downie, chief executive at Crisis. “With housing benefit frozen, more and more people are struggling to cover the cost of rent and essentials like food and bills – forcing them into a cycle of debt, poverty and homelessness.
“What’s more, the freeze puts unsustainable pressure on an already overworked system. With local authorities already under immense strain and temporary accommodation costs at an all-time high, without urgent change we will only see more people trapped in this vicious cycle.
“To bring rates of homelessness down we must have a welfare system that supports people on the lowest incomes. It’s crucial that housing benefit is uprated to cover the cheapest third of rents so it can work as intended and so that no one is faced with the trauma of losing their home.”
The freeze on local housing allowance means housing benefit claimants are virtually locked out of the private rented sector.
The 1.9% of properties deemed affordable on the market is down from 2.7% in the previous year.
Wales is the most impacted nation with just 0.7% of properties advertised for private rent affordable for households relying on housing benefit, compared to 1.8% in England and 5.5% in Scotland. Only 1.2% of properties in London were considered affordable.
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Crisis and Citizens Advice – working alongside Justlife, Shared Health, St Mungo’s, Centrepoint, Independent Age and Shelter – said the failure to ensure housing benefits keep up with rents is driving tenants into poverty.
A Citizens Advice poll found almost half of private renters receiving universal credit in the UK have had to cut back on essentials like food, transport and energy costs in the last six months.
Thousands have called on Citizens Advice’s frontline advisers for help. The advice service supported more than 6,600 private renters in England and Wales with housing benefit issues to access food banks in 2025-26. That’s a 79% increase from just under 3,700 in 2021-22.
Citizens Advice has seen the number of private renters with housing benefit issues needing support with rent arrears increase by nearly 20% over the past four years.
Those who also needed advice on homelessness rose by almost 60% over the same period. The charity has been called upon to help more than 100 private renters a day with housing benefit problems in 2026.
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Dame Clare Moriarty, chief executive of Citizens Advice, said: “Many families are already at breaking point, cutting spending back to the bone and still finding themselves unable to pay the rent or put food on the table.
“Every day our advisers are hearing from more and more people who have simply run out of options. While housing benefit remains frozen, rents are spiralling – meaning private renters are cutting back, going without, or falling deeper into debt.
“If the government is serious about turning the tide on the cost of living crisis, getting to grips with the soaring cost of housing is essential. Private renters are struggling to keep their heads above water – unfreezing housing benefit would throw them a vital lifeline.”
Local housing allowance rates have been frozen for eight out of the last 15 years.
That’s despite rents rising to record highs. The latest Office for National Statistics found rents rose by 3.3% in the year up to May 2026, representing an average monthly cost of £1,383.
Labour have so far opted not to raise local housing allowance rates since gaining power.
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Hiking rates is expensive. When the Tories raised local housing allowance rates in 2024, it raised the housing benefit bill by an estimated £1.3bn a year. Projections put that increase at £1.7bn a year by 2028-29.
But failing to increase local housing allowance rates increases the burden on individual renters in England and Wales.
The Scottish government has tried to insulate renters from the freeze, announcing an £9m fund in March to support more than 18,000 families across Scotland.
Paul Whiteheard, CEO at Zoopla said: “Our analysis lays bare the extent of the affordability challenge facing low-income renters across Britain. For far too long the number of private rent homes has remained static while demand has boomed, pushing up rents and squeezing those on lower incomes.
“Growing the supply of rented homes is the primary route to improving affordability over the long run. In the short term it is vital that the UK government unfreezes housing benefit so that it remains linked with the real cost of renting. Without this, we will only see more people facing the risk of homelessness.”
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