A recent investigation by the BBC has exposed an eye-watering fact: councils across the UK spent in excess of £1.74 billion on temporary accommodation in 2022-23. That’s more than twice the amount spent just five years ago, and the total keeps rising.
It is a surprising amount to many. But for those of us on the frontline of real estate strategy, housing delivery and public-private partnerships, it’s a sign of a deep and widening fault line in the UK’s housing system.
We at MRP Premier Group feel this is not merely a funding problem — it is a failure of strategy. And it demands immediate, structural reform.
Understanding the Problem: Short-Term Fixes to a Long-Term Problem
At the moment, local authorities are placing over 104,000 households in temporary accommodation, a quarter of which are children. These placements are frequently in private renting, hotels or short-term leases — often in a different borough from the family’s starting point, tearing people away from their communities, schools and healthcare providers.
The council has to spend tens of millions of pounds a year – we’re talking more than £40 or £50 million a year – simply to accommodate homeless singles and families temporarily – and not necessarily even meet their long-term needs.
This spike in cost is not only unsustainable — it’s counterproductive. The money is not used to build assets or add to the housing stock. Instead it is going on temporary contracts and inflated private market rents, for which there is no long-term return to local authorities or the public they serve.
The Costs Don’t Just Affect the Pocketbook
As frightening as the financial fallout may be, the human toll is even worse. Families living in temporary accommodation – experience:
- Impact on education and employment
- Poor quality or insecure housing
- Perceived stress and uncertainty/sense of insecurity
- Decreased access to medical care and social services
All are sent to locations often far from where they originally lived at home, tearing apart support networks in the community. For councils, this also translates into increasing costs in associated services — from transportation to social care.
In short: temporary housing is not just expensive — it is dangerous.
What’s Causing the Surge?
A variety of interwoven factors have driven this crisis:
- A Lack of affordable housing: Supply of affordable housing has not kept up with demand for decades.
- Soaring private rents: A significant number of families are simply priced out of the market, particularly in high-demand urban locations.
- Planning delays and land supply: Local government is frequently unable to unlock a sufficient number of viable sites for housing.
- Viability Issues Private and public sector developers are being frustrated by both financial and construction cost rises, which is affecting the deliverability of new vital housing.
- Antiquated funding models: Councils often do not have the kind of long-term investment tools to create their own housing stock.
The result? Councils are left scrambling to private landlords to secure last-minute accommodation — at great cost and with limited choice.
London’s TA Crisis: A Microcosm of a National Emergency
London stands at the epicenter of the UK’s housing crisis, with Temporary Accommodation (TA) figures soaring to unprecedented levels. As of March 2023, over 60,000 households — including around 85,000 children — were living in TA in the capital. This marks a 40–50% rise compared to a decade ago, and early 2024 data suggests the numbers are still climbing.
What began as a stopgap has now become a long-term trap. London boroughs are spending approximately £4 million daily — or £90 million per month — on TA. This extraordinary spend diverts funds away from education, health, and local infrastructure.
The situation is especially dire in boroughs like Newham, where 52 out of every 1,000 households are in TA — the highest rate in the country. All London boroughs exceed the national TA average, with seven boroughs facing rates five times higher than the rest of England.
The financial burden is severe — but the human impact is worse. Families endure unfit living conditions and prolonged insecurity, with children’s health and education suffering profoundly. It’s a crisis that speaks to wider national failings.
Breaking the Cycle: What Needs to Change
The crisis in London reflects deeper, structural issues in housing policy nationwide. The key drivers include:
- Escalating housing costs: With the average rent in London now over £2,000/month, homeownership is out of reach for many.
- Dwindling social housing: Policies like Right to Buy have eroded public housing stock.
- Economic pressures: Welfare cuts and the shift to Universal Credit have destabilised low-income households.
- Post-COVID impacts: Job losses and rising living costs have triggered widespread financial vulnerability.
- Displacement from boroughs: Out-of-borough placements have doubled in the last decade, fragmenting communities.
To Reverse the Trend:
- Build more affordable homes across social, shared, and mid-market sectors.
- Reform benefits and boost council capacity to meet housing needs.
- Improve TA standards and enforce quality regulations.
This isn’t just a housing issue — it’s a public health, economic, and social crisis.
A Fresh Approach: From Emergency to Strategic Delivery
While the current model tends to be reactive—offering temporary shelter rather than lasting solutions—the real challenge lies in the limited housing supply. Councils are eager for permanent outcomes, and we’re actively working to identify and expand opportunities that enable the public sector to deliver long-term stability.
At MRP Premier Group, we are fans of moving from emergency spend to strategic investment. We partner with government and industry to deliver housing that is scalable, commercially viable and meets community needs.
Here’s how:
- Unlocking Underutilised Land: We assist councils to identify and activate surplus land, brownfield sites, and urban infill opportunities to unlock and deliver viable housing developments.
- Public Private Partnerships (PPPs): We are creating innovative partnerships that enable councils to hold on to the ownership of the land while accessing private sector expertise and capital—delivery without undue financial risk.
- Integrated, Mixed-Tenure Developments :Our projects foster community diversity, social inclusion, and long-term tenancy success by combining affordable, market, and shared ownership housing in one location.
- Planning-Led Strategies: MRP steers through early planning obstacles, to speed approvals and ensure that plans fit with local policy emphasis and to avoid a delayed start on site.
MRP Dedication to Long-Term Solutions
We live and breathe the value of strategic partnerships and delivery. We assist local authorities with:
- Finding strategic places for housing
- Formulating policies of development and patterns of investment
- Aligning housing policy with financial, social and place outcomes
We are not developers; we are value creators. And in today’s world, that has never been more urgent.
Final Thoughts: We Cannot Wait
Last year the £1.74 billion bill for temporary housing could have been spent building thousands of new homes. Instead, it was sieved through short term fixes that have no legacy or security.
The system is choked, but in that chokehold there is an opportunity: an opportunity to build better, smarter and more sustainably.
At MRP Premier Group, we’re here to help with that change. If you’re a local authority, housing association or investor or anyone looking for a different way forward we’d love to talk to you.
Let’s build housing that works—for today, and for decades to come.
Contact us to explore partnership opportunities.
