The Department for Work and Pensions has been urged to change Local Housing Allowance (LHA) rates. LHA affects roughly one million low-income private renters across the country who receive housing support through Universal Credit or Housing Benefit.
LHA rates have been frozen or held at current levels for 2026/27, and every major housing body warns that this is pushing low‑income private renters into debt, arrears, and homelessness. The pressure on the Department for Work and Pensions (DWP) to change LHA is coming from councils, charities, MPs, and rent‑market data showing the allowance no longer reflects real rents.
LHA frozen, rents rising, cap locked — the safety net snaps.
Compass says the LHA freeze has snapped the link to real rents — and urges the DWP to fix it.
Compass says if rents had been frozen and LHA restored to the real 30% benchmark, renting households would be £2,400 better off, and the poorest renters would have 22% more disposable income — a policy freeze that’s costing people their lives, not just their money.
Compass says restoring LHA and freezing rents wouldn’t just ease pressure — it would lift 170,000 people out of poverty and stop retrofit costs being dumped onto tenants through higher rents.
Compass argues that rent controls would slash the housing benefit bill — saying that if rents had been frozen since November 2022, they’d now be 20% cheaper, enough to relink LHA to the real 30th percentile and save £2 billion a year in England alone.
The LHA freeze is locking low‑income renters out of safe, affordable homes — every month it stays frozen, the door closes a little tighter.
Shelter warns that as rents keep climbing while LHA stays frozen, more people will be left clinging to their homes by their fingertips — and many will lose their grip altogether.
Ben Beadle says the evidence is clear: unfreezing housing benefit doesn’t trigger a rent surge — the market moves for its own reasons, not because tenants finally get enough support to cover the basics.
He says rents aren’t set by benefit rates at all, but by the hard maths of tax, mortgages, tenant demand and regulatory costs — the market moves because of its pressures, not because LHA might finally catch up.
He warns that freezing housing benefit doesn’t stabilise the market — it simply locks financially‑squeezed renters out of housing altogether and sabotages every effort to tackle homelessness.
The LHA freeze is shutting people out of housing, pushing rents further out of reach, and turning a policy choice into a homelessness machine.
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