MORE than 12,000 Oxford residents will be able to afford just 5,200 city properties because of controversial cuts to housing benefit, new figures suggest.

The number of Oxford homes which the benefit can fully cover will fall from 8,500 to 5,200 because of a limit on how much can be claimed, they show.

It means a third of properties in the private rented market can be covered with the benefit, compared to half before.

Critics warn the 12,670 claimants will find it more difficult to find a home in the city.

But the Government said the move is vital to save cash and make landlords reduce rents.

The occupiers of a two-bedroom flat can now claim £150 a week, instead of £196.15 before, while a shared home gets £78.46 compared to £85.38 before.

The figures were compiled from Government statistics by the Chartered Institute of Housing.

Interim chief executive Grainia Long said those whose benefit no longer covered their rent would have to make savings to find the extra cash.

She said: “The only feasible option for many families who want to stay in their communities will be to borrow more or to spend less.”

Ed Turner, deputy leader of Labour-run Oxford City Council, said claimants risked being priced out of the city.

He said: “I am being approached by people who know me in the street saying their housing benefit is being cut and they don’t have the money to pay the rent.”

Sharon Cadogan, property manager at Cornmarket Street-based Rentaflat Limited, said: “Tenants may have to find ways of making the rent up or they could have to move out the county.”

But Department for Work and Pensions spokesman Owen Brace said “early indications” did not show claimants leaving cities “in their droves”.

He said: “Our measures will place a lid on spiralling rents and local authorities will continue to work with tenants and landlords to negotiate down rents, which will in turn help to keep properties within reach.”

Rents had been artificially inflated by high benefit rates, he said, which are costing taxpayers £21bn a year.

Father of four John-Paul Smith is unemployed and on housing benefits.

The 37-year-old Blackbird Leys resident said: “There is a lack of housing in Oxford.

“We need more council housing to meet the demand.”

Changes also restrict family claimants to four-bedroom properties, and single people aged 24-35 to a room, not a flat.

The benefit rate was previously based on the cost of a property in the middle of a list of all properties from cheapest to most expensive.

But it will now be based on a property that is 30 per cent above the cheapest.

Of the 48,400 rental properties in Oxfordshire, some 16,000 will be fully covered by the benefit compared to 25,500 before, the institute’s figures also show.

For benefit advice in Oxford, call 01865 249811.