Families need an extra £8,000 a year or more to afford an acceptable minimum standard of living, because social housing is a no longer a realistic option, say researchers.
For the first time in its 18-year history, Loughborough University’s Minimum Income Standard (MIS) has calculated household budgets based on private rented sector costs rather than social housing.
The shift in focus comes after members of the public in the study’s focus groups agreed it was no longer reasonable to assume any household type could access a social home if needed.
According to the Joseph Rowntree Foundation (JRF), which funds the annual, study, the change reflects public frustration with wait times for social homes – a problem the organisation said stems from successive governments failing to build and retain enough social housing over the past three decades.
Because social rents are regulated and set against local incomes, while private rents face minimal restrictions, the shift has pushed up the budgets needed to meet MIS across all household types:
- Lone parents with two children now need £67,600 a year to reach MIS when renting privately, compared with £59,800 in social housing – almost £8,000 more
- Couples with two children now need £77,400 between them, compared with £73,600 in social housing – almost £4,000 more
- Single pensioners now need £21,300 a year, compared with £15,900 in social housing – over £5,000 more
Dr Chloe Blackwell, of the Centre for Research in Social Policy at Loughborough University, said: “While a renewed commitment to improving living standards in the UK, signalled by prime minister Andy Burnham, is good news for low-income households, tackling the high and rising cost of housing needs to be at the forefront of any plans to reduce the cost of living.
“Private renting has become the only real option for more and more people in the UK, with many households facing crippling costs just to keep a roof over their heads. If this continues, we can expect to see the gap between incomes and needs widen further, leaving even more households far short of reaching a decent standard of living.”
The research found households falling further short of MIS on both out-of-work benefits and the National Living Wage (NLW) than in 2025.
Out-of-work lone parents now reach 36% of MIS after housing costs, down from 43% in 2025, and would reach 44% if still in social housing. Those on part-time work reach 59%, down from 61%, against 62% in social housing. Full-time workers reach 67%, down from 68%, against 70% in social housing, a shortfall JRF attributed to the Universal Credit taper and childcare costs.
Couples with two children on out-of-work benefits reach just 28% of MIS, down from 36% in 2025, against 35% in social housing. Couples in full-time work on the NLW reach 80%, down from 81%, against 83% in social housing.
Single pensioners relying on the state pension or pension credit reach 90% of MIS, down from 95% in 2025, against 97% in social housing.
Support for private rents through Universal Credit remains capped by the Local Housing Allowance, which has been frozen since 2024. As the JRF noted, fewer that 2% of properties listed on Zoopla in 2025/26 were affordable for renters on housing benefit.
The report further noted that gains from government measures including National Living Wage increases, above-inflation uprating of Universal Credit and expanded childcare support are being offset by high private rents.
The government has committed to building more social and affordable homes and introducing tenant protections through the Renters’ Rights Act. However, the report said new homes would take years to affect rents, which are forecast to continue absorbing all average wage growth until at least the end of the decade, according to the Office for Budget Responsibility.
JRF said the scale of the affordability crisis warranted the introduction of rent controls.
Darren Baxter, housing lead at JRF, said: “We are no longer living in a world where privately rented homes are a temporary pit stop for young, single professionals. They’re now the homes where families are bringing up their children, from babies to teenagers, as well as where people are growing old. But the eye-watering rents that people are paying are denying them the stable foundation they need for a good life.
“Families can’t wait the decades it will take for the new homes currently being built to have an impact on their rents – their children will be adults by then. But unaffordable private rents aren’t a given. Rent controls would be the solution that would give families security and stability and they should be implemented without delay.”
Image credit: Andrew Khoroshavin from Pixabay
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