Boost to housing support will benefit renters

Around 1.6 million private renters are set to receive an uplift to their housing support for 12 months from April 2024, as the UK Government lays legislation to raise Local Housing Allowance (LHA). The increase will benefit some of the poorest families on either Universal Credit or Housing Benefits who will gain around £800 a year on average.

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A positive step but more is needed

Propertymark welcomes this move, which was originally announced in the Autumn Budget, having lobbied for an uplift in LHA since the rates were frozen in 2020.

We remain committed to improving LHA levels and would like to see it increased annually to keep up with market rates, rather than frozen again in 2025 as the UK Government currently intends.

Since 2020 LHA has increasingly lagged rising rents and effectively priced the most vulnerable tenants out of the market for private rented homes. We will continue to urge the UK Government to go further and increase the LHA level to the 50th percentile. This will ensure that tenants have wider access to secure and affordable housing options.

Other rates increasing

Also in April 2024, the National Living Wage for workers aged 21 years and over will increase by 9.8% to £11.44 representing an increase of over £1,800 to the gross annual earnings of a full-time worker.

In addition, 27 million people are set to get a tax cut as the main rate of employee National Insurance will be cut from 12% to 10%, saving £450 this year for the average salaried worker on £35,400. 

What this means for tenants

The Local Housing Allowance determines the maximum housing support for private renters. It ensures that claimants in the same area with similar situations are entitled to the same maximum support regardless of the rent they pay. The level of support is based on the area where the person lives and the size of their household.  

The Department for Work and Pensions has published indicative rates for 2024/25 based on Rent Officer data for the 30th percentile of market rents collected in the 12 months ending 30 September 2023. Subject to the benefits cap, per month eligible renters could get up to the following: 

  • A four-bedroom property in Bristol = £1,850 
  • A two-bedroom property in Greater Glasgow = £850 
  • A one-bedroom property in Leeds = £675 

Minister for Levelling Up Jacob Young, MP, stated that the UK Government has invested £30 billion in housing support, along with Discretionary Housing Payments which provide an added safety net for anyone struggling to meet their rent.

08 Mar 2023
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