• Research also finds that spending on hostels, B&Bs and nightly paid accommodation increased by a staggering 400% between 2018 and 2024
• Crisis calls for ambitious new homelessness strategy, 90,000 new social homes per year and for ministers to unfreeze housing benefit in the Comprehensive Spending Review

Research released today reveals the depth of the homelessness crisis in England, with council spending on the most unsuitable forms of emergency accommodation now projected to reach £1.2bn within three years.

The new research, conducted by researchers from LSE and commissioned by the charity Crisis, indicates that approximately 56,000 households stayed in hostels, B&Bs and other nightly-paid accommodation in 2023/24 in England. The net expenditure for this emergency accommodation totalled £732 million, a more than fivefold increase from the £135 million spent in 2017-18. This accounted for the majority (69%) of overall net expenditure on temporary accommodation by Local Authorities in 2023-24.

If the use of emergency accommodation continues its current trajectory, the researchers project that 68,700 households will be forced into the most unsuitable emergency accommodation by 2026/27, requiring a net expenditure from councils of £1.2 billion. This is a 63% increase over three years, when current spending is already at a record high.

The research comes as Crisis hosts a summit in London (Tuesday 25 February) seeking to raise ambition and platform solutions for ending homelessness. Last year the Westminster government pledged to introduce a cross-government strategy to ‘put Britain back on track to ending homelessness’. Crisis’ summit will host speakers from across government, parliament, councils and civil society, before ministers publish their strategy later this year.

The research also indicated that the productivity losses associated with emergency accommodation in 2023/24 were estimated at £733 million, showing the substantial impact on households trapped in emergency accommodation and the wider economy. LSE found that diverting 25% of the current spend on emergency accommodation to prevention services would have a positive return on investment within a year. For every £1 spent on prevention, the researchers found a minimum £1.32 return is estimated in the first year. [1]

Homelessness is increasing across the country. There are now more than 120,000 households living in all forms of temporary accommodation in England, including nearly 160,000 children. Temporary accommodation is frequently cramped or dangerous. Official data recently revealed that temporary accommodation had contributed to the deaths of at least 74 children over the past five years. Rough sleeping rates are reaching record levels in some areas. Last year saw a 27% increase in England, with more than 4,600 people seen sleeping rough in London between October and December.

Since July 2024 the new Westminster government has pledged a generational increase in new social and affordable housing, amid a wider goal to build 1.5million new homes. Earlier this month ministers pledged £350m for affordable and social rent homes, further to a £500m boost to the Affordable Homes Programme last October.

Ahead of the publication of the Westminster government’s strategy, Crisis is calling on ministers to:

• address plummeting rates of social housebuilding by supporting the building of 90,000 new social homes per year in England [2]
• unfreeze local housing allowance (LHA) so it consistently covers at least the lowest 30% of local rents
• lift the temporary accommodation subsidy cap – frozen since 2011 – to ensure that councils are able to support people into good quality temporary accommodation.

Matt Downie, chief executive of Crisis, said: “The current system is broken. With a lack of social housing and limited funding for prevention services, councils are being forced to spend millions on often cramped, mouldy and unsuitable emergency accommodation. This becomes a bill for keeping people homeless, in limbo, robbing them of their potential and denying children their childhoods.

“In the next few months, the Westminster government has a once in a generation opportunity to build a future free from homelessness. With an ambitious government strategy, ministers can drive the delivery of genuinely affordable housing, and they should pull every lever available to them, including keeping local housing allowance in line with the lowest local rents.”

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Notes to editor

[1] If 25% of the households in emergency accommodation in 2023-24 had instead been supported with prevention services, savings are estimated at £177 million. This accounts for a higher-end estimate of delivering prevention based on service delivery costs in London. In this scenario, for every £1 spent on prevention a minimum £1.32 return is estimated in the first year.

[2] There has been a net loss of 180,000 social homes in England over the past 10 years.