Citizens Advice has found 58 percent of private renting households receiving housing support across Great Britain cannot cover their full rent, leaving almost one million homes with a monthly shortfall.
The charity said the total has risen by almost 300,000 households since May 2024, when the government last increased support. It put the current caseload at around 900,000 households in England and 50,000 in Wales, with the balance in Scotland.
Private landlords with tenants on Universal Credit or Housing Benefit face the direct arrears risk from that gap. With the Autumn Budget due later this month, Citizens Advice wants ministers to unfreeze Local Housing Allowance and restore its link to the cheapest 30 percent of local rents.
Shortfalls concentrated in Wales and North East
Regional figures show nearly seven in ten claimants face a shortfall in Wales and the North East. The three worst-hit areas are all in Wales, with 79 percent of recipients affected in Blaenau Gwent and 77 percent in both Pembrokeshire and Caerphilly.
In England, 68 percent face shortfalls on the Fylde Coast and 66 percent in Sunderland, according to the research reported on 19 October.
Citizens Advice linked the pattern to high unemployment areas with limited housing supply, fewer job options and weak transport links. In a survey of more than 130 frontline advisers, 45 percent said they had helped people pay higher housing costs to live closer to work, while 22 percent had helped people move further from jobs to cut rent.
Tom MacInnes, director of policy at Citizens Advice, said people were caught between high rents near work and high travel costs from cheaper areas. “People are caught between a rock and a hard place – struggling to afford housing near their work or children’s school, or dealing with poor transport links and high travel costs to live where rent is cheaper,” he said.
LHA frozen while rents climb
Local Housing Allowance sets the maximum housing support private renters can receive through Universal Credit or Housing Benefit. It was designed to track the cheapest 30 percent of rents in each area but has been largely frozen for a decade, apart from an increase in April 2024 based on September 2023 rents.
Since that data was collected, rents have risen by an average of 18 percent in England and 20 percent in Wales, the charity said. That leaves current rates, in its words, woefully out of step with market rents.
This follows Landlord Knowledge’s July report that housing benefit covered just 1.9 percent of rentals listed in Britain. The latest 58 percent shortfall figure suggests the squeeze on benefit tenants has widened from availability to sustained top-ups from other income. Combined with calls for a 10th-percentile LHA reset, the pressure for Budget action is now coming from both charities and think tanks.
Mr MacInnes said the gap was driving regional inequality. “The cost-of-living crisis is punishing households everywhere, but the chasm between housing benefit and the cheapest rents is pushing households to the brink and driving up regional inequalities,” he said. “That’s why the government must unfreeze housing benefit and link it back to local rents.”
Citizens Advice argues restoring the 30 percent link would ease pressure on low-income renters and cut arrears risk. The Treasury and the Ministry of Housing, Communities and Local Government were asked for comment. Further detail on the method sits in Citizens Advice analysis of the LHA freeze.
What this means for landlords
- If you let to benefit claimants: check tenancy affordability now and agree how any shortfall will be paid before arrears build
- Watch for: the Autumn Budget decision on LHA – an unfreeze would narrow gaps from next year, a further freeze would lock them in
- Bottom line: shortfalls affect more than half of supported tenancies, so rent records and early contact matter more than ever
Editor’s view
The numbers explain why arrears feel sticky even where employment holds up. A benefit system fixed on 2023 rents cannot support 2026 rents. Landlords cannot fix LHA, but they can price risk correctly and keep clear payment trails until the Budget gives a clear answer.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 20 October 2026
Sources: Citizens Advice, Inside Housing
Related reading: Housing benefit now covers just 1.9% of rentals
