Private sector rents exceeding housing allowances

New research by the Chartered Institute of Housing (CIH) has found that housing allowances are not keeping up with rents in the private sector.

The study identified a wide gap between Local Housing Allowance (LHA) and the rent tenants must pay.

The report examined LHA rates since 2012. LHA rates were introduced to give people access to 30 per cent of the market. However, the research revealed that in some areas people are only able to rent in the bottom five or 10 per cent of the private rented sector market.

CIH warned that the situation will only worsen because of the LHA rate freeze.

Terrie Alafat CBE, CIH chief executive, said: “We are becoming more and more concerned by the lack of correlation between LHA rates and rents, and our research shows that people are going to find it difficult to continue renting in the PRS.”

She added: “CIH is calling on the government to review LHA rates for all categories of accommodation, to make sure everyone is able to access a safe, affordable home.”