Just 46 homes on the rental market in Manchester last year were affordable for people relying on housing benefits. The average cost of rent for a large family home in the city is now £821 more than the Local Housing Allowance.
It comes as rental costs continue to increase with the average two-bedroom property in Manchester city centre now priced at £1,279 per month. Across the rest of the city, the cost of rent has risen even more – by 4 pc on average.
However, Local Housing Allowance rates have been frozen since 2020. In Manchester, the monthly allowance for a two-bedroom home is £648.22.
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According to property website Rightmove, just 46 properties across the city that were available to rent last year were below the Local Housing Allowance rate, 38 of which only had one bedroom. Just two had four bedrooms or more.
The data, which features in a town hall report, does not include council homes or properties owned by housing associations which are subject to waiting lists. Local leaders have called for a rent freeze and an increase to housing benefits.
But Labour councillor Gavin White, who is the executive member for housing and development at Manchester council, also said more housing must be built.
He said: "We need to build more and build stuff quickly. There's just a lack of supply of homes of all types which means rent can go up in the private sector.
"The delivery of homes has been challenging because of the cost of inflation and materials. But we've got 1,000 affordable homes on site at the moment.
"If there were more homes, there'd be slightly less demand and also less profiteering. That's why we've been calling for rent controls and rent caps."
Manchester council published a new housing strategy last year which said that 36,000 new homes must be built across the city within a decade and 10,000 of them should be affordable. The local authority will build council homes and sell land on the cheap to housing associations to build more affordable homes.
Local Labour politicians have called on the government to raise Local Housing Allowance rates to help close the growing gap between housing benefits and rent. They have also called for a freeze on rent charged by private landlords.
Confirming that Local Housing Allowance rates would be frozen for a third year last autumn, the government said spending on housing benefits is expected to cost the taxpayer around £50bn a year by 2050. However, other benefits were increased alongside the introduction of several cost of living support schemes.
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