Record number of families are living in temporary accommodation as the availability of social housing and government support for renters lags behind

A record 128,000 households are living in temporary accommodation in England, an increase of 160 per cent since 2010, as support for lower-income families through social housing and the benefit system continues to decline, according to new Resolution Foundation research published today (Friday).

With the creation of decent affordable homes being one of the Government’s central milestones, the Foundation’s latest Housing Outlook examines five key housing trends that underscore the scale of the challenge Britain is facing.

The Foundation is launching 12 new indicators– funded by the Wates Family Enterprise Trust – that track how housing is shaping living standards for families. These indicators include measures of housing affordability and quality today, alongside forward-looking indicators on housing supply and the planning system.

One of the indicators’ starkest findings is that the number of households in temporary accommodation has more than doubled since 2010, from 50,000 to 128,000 households in England today – a 160 per cent increase. Single-parent families are particularly hard hit, representing 35 per cent of those in temporary accommodation in England, despite making up only 16 per cent of UK households.

Over half of families living in temporary accommodation are in London (72,000), with Newham having the highest rate of any local authority – one-in-20 households are currently living in temporary accommodation.

Temporary accommodation is expensive too. The £2.3 billion local councils spend on temporary accommodation costs 2.4 times as much per household as the national government spends on housing benefit (£12 billion across 1.6 million households)

The report cites insufficient social housing as an important driver of this steep rise. ‘Affordable’ or ‘intermediate’ rent homes – where rent can be as much as 80 per cent of market rates – have increasingly replaced social rent, which is typically set at around 50 per cent of market rates. Social rent accounted for just 16 per cent of new below-market-rent homes in England in 2023-24, down from 87 per cent in 1992-93.

The Foundation adds that the fall in social housing supply is most marked in the capital, where just 8 per cent of ‘affordable homes’ built were for social rent (compared to 28 per cent across the West Midlands).

A further factor pushing families into temporary accommodation is the shortfall between private rents and rates of Local Housing Allowance (LHA). The repeated freezing of LHA since 2013 has meant that private rents in Britain have increased by 54 per cent while LHA rates have gone up only 36 per cent.

As a result, LHA only covers the full housing costs of roughly half (48 per cent) of privately renting families on Universal Credit. With LHA continuing to be frozen in nominal terms, more and more households will be affected by this shortfall over time.

The report notes that increasing housing supply will be key to easing pressures in the long-term. The Government’s planning reforms and ambition to hit 1.5 million new homes in England by the end of the Parliament are therefore welcome, as is the £39 billion Affordable Homes Programme – the biggest annual commitment since the 2008-11 programme. Critically, 60 per cent of this funding has been allocated to social rent, which should help stem the steep decline in social housing across England.

But the country is starting from a historically low base of housebuilding, warns the Resolution Foundation, with planning approvals for new housing developments in the last quarter of 2024 standing at the lowest level since 1979, at just 7,356.

Camron Aref-Adib, Economist at the Resolution Foundation, said:

“The skyrocketing number of families in temporary accommodation in England shows the sharpest end of a far wider housing crisis.

“The decline in social housing and the shortfalls between Local Housing Allowance and private rents have contributed to the rise in temporary accommodation; both are areas where the Government can make a difference.

“The Government’s house-building ambitions, its focus on planning reform and the hard cash for affordable homes are all welcome. But this crisis is deep-rooted and cannot be fixed quickly. The fall in planning approvals for housing developments to a record low shows the scale of the challenge the Government is confronting as it seeks to ease the impact of housing pressures on living standards.”