Poverty continues to rise among older private tenants, underscoring the increasing financial stress within the sector. Government figures show that 34% of older tenants receiving housing benefit are now living in poverty, up from 27% last year.
New analysis from independent age The suggestion is that the situation could improve significantly if housing assistance kept pace with market rents. The charity estimates that around 37,900 former private tenants could be lifted out of poverty if local housing allowance (LHA) rates were in line with actual rental costs.
LHAs, which set housing benefit levels for low-income private tenants based on local rent benchmarks, have increasingly lagged behind rising prices. Although it was expected to be upgraded to cover at least the cheapest 30% of the rental market, the government opted to extend the existing freeze in the autumn budget. Over the same period, from April 2024, when the LHA was last adjusted, average UK rents have increased by 10.5%.
Independent Age is calling for an annual review mechanism to ensure that the LHA keeps track of rental inflation and continues to cover low-cost housing. While rates are anchored at the 2024 level, the policy has already been frozen for eight of the last 15 years, making its real value increasingly tenuous.
The charity also highlights the wider impacts across the sector, with more than 270,000 older private tenants currently facing a shortfall between their rent and their housing benefit entitlement. Many are reportedly closing the gap by reducing spending on essentials such as food and heating, reflecting a direct effect of the mismatch between support levels and housing costs.
Joanna Elson, chief executive of Independent Age, said: “The situation is dire for many low-income tenants of all ages. Our research shows that local housing allowance not being increased to keep pace with rising rents has a very direct impact on the lives of older private tenants. We know that some have to choose whether to skip meals, use their lights at night, or keep a roof over their heads.
“The UK Government should at least raise Local Housing Allowance so that it covers the cheapest 30% of the market, as has been done before. Currently, this measure is leaving rents falling even further behind and we know that, for many, this means cutting back to dangerous levels. Many other financial entitlements have been extended this month, why should Housing Benefit be any different? Adequate levels of LHA are vital to ensure that older people in financial difficulty have a safe and affordable This situation is not sustainable and older tenants are at risk of homelessness, it must be addressed.