Getting an affordable home on housing benefit ‘harder in Wales than London’

Martin Shipton

Shocking new data has shown how it’s more difficult for people on housing benefit in Wales to find affordable homes than those living in London.

A report from the homelessness charity Crisis – supported by Health Equals, a coalition of groups campaigning for greater equality in health provision, and data from the property website Zoopla – reveals the extent of the housing affordability crisis which is forcing people into homelessness and unsuitable accommodation.

It shows that just 1.2% of private rental properties in Wales are affordable for people claiming housing benefit, against 1.6% of such properties in London.

Five areas

In five areas of Wales – Blaenau Gwent, Brecon and Radnor, Flintshire, Monmouthshire and south Gwynedd – data from Zoopla showed there were no rental properties at all that could be afforded by housing benefit claimants.

Other British regions had slightly higher percentages of homes that could be afforded by those on housing benefit: North West [of England], 2.5%; East Midlands, 2.7%; South East, 2.7%; East of England, 2.9%; West Midlands, 3.2%; South West, 3.2%; Yorkshire and The Humber, 4.2%; North East, 5.6%; Scotland, 8.1%.

The report says the situation is bleak overall, with just 2.7% of private rented properties affordable across Great Britain. By looking at the gap between housing benefits and the cheapest 30% of rents between April and October 2024, the data shows that households in Britain that rely on housing benefit are having to scrape together, on average, an additional £337 a month for a one-bedroom, £326 for a two-bedroom and £486 for a three-bedroom home.

Freeze

To make matters worse, a nationwide freeze on housing benefits comes into force on April 1. As a result, the one in five households in Wales that rely on housing benefit to pay their rent will see a real-terms cut in the amount of support they receive. This means they are now even more likely to face difficult financial choices to meet rent costs, be pushed into arrears or even be forced into homelessness.

Latest official figures show that more than 11,000 people across Wales are living in temporary accommodation such as B&Bs and hotels. This type of accommodation can often be cramped and lack access to basic cooking and laundry facilities, affecting people’s health and wellbeing, and making it difficult to build a life beyond homelessness.

The high numbers of people living with the trauma of homelessness is also piling pressure on local councils in Wales which, it is reported, faced a combined temporary accommodation bill of £99m in 2024. The report says it will be crucial that the Welsh Government presses ahead with building more affordable social housing at pace, as well as proposals to change the law in Wales to help prevent people from becoming homeless in the first place.

Housing benefit

However, the failure of housing benefit to meet the true cost of rents is undoubtedly a factor contributing to the high numbers of people facing homelessness in Wales. With powers to change housing benefit resting with Westminster, Crisis is calling on the UK Government to restore housing benefit so that it covers the bottom 30% of local rents, enabling people to pay their rent and find affordable homes.

Debbie Thomas, head of policy and communications (Wales) at Crisis, said: “It’s truly shocking to see that only 1.2% of private rental homes in Wales are accessible to people on low incomes. Indeed, these new statistics show that there are even fewer affordable homes to privately rent in Wales than elsewhere in Great Britain.

“Everyone needs a safe place to call home, but housing benefit is failing to meet the true cost of rent and is leaving people trapped in temporary accommodation.

“We are pleased the UK Government is drafting a new cross-government strategy to get Britain back on track to ending homelessness. These shocking statistics send a clear message that this plan must include addressing the shortfall between housing benefit and the real cost of renting a home. This would make a huge difference to many people at risk of and experiencing homelessness in Wales, and across Great Britain.

Richard Donnell, executive director of research at Zoopla said: “It is clear that we desperately need more affordable homes across Great Britain. A booming demand from renters is pushing rents higher and squeezing those on lower incomes.

“Without building more affordable homes across each nation and uprating housing benefit so that we maintain the link with rent levels, more people will be forced from the private rented sector into homelessness.”

Crisis is asking its supporters to take action by writing to their MP to highlight the issue and call for housing benefit levels to be increased.

In Wales as a whole, 277,399 households were receiving the housing benefit element of Universal Credit in November 2024.

In December 2024, Shelter Cymru research showed the cost to local authorities of providing temporary accommodation in Wales stood at £99m in 2023-24.