Data revealed that 56 per cent of private renters relying on Universal Credit have an average gap of £100 a month between the amount they receive and their total rent costs.
According to the National Residential Landlords Association (NRLA), almost 60 per cent of renters with two children rely on Universal Credit to help pay their rent but report a monthly shortfall.
Regionally this varies from 40 per cent in London to 68 per cent in Wales.
The Local Housing Allowance used to calculate the amount tenants can receive to support housing costs as part of a Universal Credit payment.
In April 2020 amid the pandemic, the allowance was lifted so that it covered the bottom 30 per cent of private rents in any given area.
But in April last year the rate was frozen in cash terms as the housing benefit was no longer linked to current rents.
According to NRLA, this means the number of properties that private renters in receipt of Universal Credit can afford will steadily decline.
As such, it is calling on the government to unfreeze the Local Housing Allowance to cover average rent.
Ben Beadle, chief executive of the National Residential Landlords Association, said: “It is simply absurd that housing benefit support fails to reflect the reality of rents as they currently stand. All the freeze is doing is exacerbating the already serious cost-of-living crisis.
“The chancellor needs to listen and respond to the concerns of both renters and landlords and unfreeze housing benefits as a matter of urgency.”
A Department for Work and Pensions (DWP) spokesperson, said: “As part of this government’s unprecedented package of support for renters in the pandemic, we increased Local Housing Allowance rates to the 30th percentile in April 2020. This was significantly beyond increases due to inflation, boosting support by almost £1bn and benefiting around 1.5 million households by £600 on average over the year.
“We have since maintained rates at the same cash level, meaning that everyone who benefited from the increase will continue to do so and support for private renters is still higher than it was before the pandemic.”
