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August 4, 2023

Rental market changes push more families into temporary accommodation

Matthew Wilkins

By Matthew Wilkins

Last week the UK government published the latest figures on the number of people experiencing homelessness residing in temporary accommodation in England. They made headlines, and rightly so, but what do we know about the story behind the numbers? 

First of all, the numbers:

A chart showing the increase in the number of households in Temporary Accommodation

The number of households at risk of homelessness and living in temporary accommodation in March 2023 was 104,510. This is an increase of more than 10% in a year. And it is now the highest ever recorded - up from a low of 48,010 in December 2004.

The use of temporary accommodation is concentrated in London, the major cities and some coastal towns.  Half of all people experiencing homelessness placed in temporary accommodation are in just 33 - or 11% - of English local authorities.  57% of people residing in temporary accommodation in England are in London. 

Although the major urban centres and coastal communities host the majority of people residing in temporary accommodation, the figures also show that there have recently been sharp increases in its use elsewhere in the country. Numbers in temporary accommodation have risen by over 20% in the North East, Yorkshire and the Humber, and the South West in 2022/23, albeit from a much lower starting point. 

Another particularly notable increase has been in the use of B&Bs. At the end of March, 13,780 households were living in bed and breakfast (B&B) accommodation, up 37.4% from the same time last year. 

Also notable is the number of children to experience life in temporary accommodation. Overall, 64,940 families or 62.1% of households in temporary accommodation included dependent children, with 131,370 dependent children living in temporary accommodation. This is an increase of around 10% on last year.

The number of families in B&Bs with dependent children increased 131.2% to 3,930 households in March 2023. Of the households with children in B&B, 1,840 had been resident for more than the statutory limit of 6 weeks. This is up 174.6% from 670 on 31 March 2022, and up 14.3% from 1,610 in the previous quarter. This is despite it being unlawful for local authorities to keep families with children in B&Bs for more than six weeks.

The use of Bed & Breakfast accommodation is even more concentrated than temporary accommodation overall, with half of the B&B for families over 6 weeks in just 8 local authorities. 

As we at CHI have pointed out in the past, the use of temporary accommodation is not of itself a bad thing: after all, it means that local authorities are housing people who would otherwise be at risk of homelessness. If these risks rise, then so too should the support offered. 

However, we also know that many families will experience stays of months if not years in temporary accommodation - meaning that in reality it is anything but temporary. This will for many families mean years spent in overcrowded conditions, which research suggests can impact on children’s schooling and development. 

Causes of the rising numbers

There are a number of causes of the increased number of people in temporary accommodation, some of which have emerged recently, others which are long-lasting: 

  • The continued decline in the number of lettings to social housing
  • Decreased affordability of accommodation in the private rented sector since the Coalition government’s welfare reforms from 2011 reducing local housing allowance (LHA) rates to 30th percentile rents and with subsequent LHA freezes reducing the rents payable by households reliant on benefits relative to market rents much further    
  • More recently a decline in the availability of private sector accommodation across the country 
  • Covid-19 which reduced family homelessness pressures but significantly increased the number of single people accommodated by local authorities in temporary accommodation
  • Post-Covid increases in family homelessness as restrictions on evictions have ended and the cost of living crisis has reduced the ability of many households to afford the rents being demanded in the private rented sector 
Rise in use of Bed & Breakfast

Why has there been such a dramatic rise in B&B use for families over the past year?

This is not completely understood, but seems to be a combination of:

  • Increased homelessness demand, at least partially related to the cost of living crisis
  • Rapid rent increases combined with frozen LHA rates, so that in many areas only a tiny proportion of properties are available to let at LHA rents
  • The inability of councils to secure TA from the private rented sector. In London this is partly due to the set maximum rates payable by councils under the Inter Borough Accommodation Agreement (IBAA), which have suppressed TA cost for a number of years, no longer being sufficient to secure accommodation in an overheated rental market.
  • B&B remains the type of accommodation Councils have to use in extremis and whilst a still small proportion of total TA, percentage rises have increased dramatically due to the reduced availability of other accommodation.        
How local areas respond

Some local authorities are taking action to be able to respond to demand for temporary accommodation, with measures including:

  • use of modular construction to produce TA quickly
  • encouraging people experiencing homelessness to take offers in the Private Rented Sector while remaining on the waiting list for social housing. 
  • Direct ownership or management of hostels 

Plus it is also worth noting that when the number of people experiencing homelessness rose in the past, action was taken by government and local authorities which enabled these numbers to fall. 

Such positives will be important to bear in mind in months to come, as numbers are likely to continue to rise. 

Matthew Wilkins is Head of Value for Money at the Centre for Homelessness Impact.

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