The number of working households in London claiming benefit to cover the costs of private sector rent will reach a tipping point by Christmas, the umbrella group representing the capital's councils has forecast.

Research issued by London Councils today asserts the capital could become the only part of the country where the numbers of people in working households receiving private housing benefit exceeds the number of those in jobless households before the end of the year.

This follows a 17% increase in the number of people claiming the Local Housing Allowance since April 2011, a hike made up almost entirely by working households, which accounted for 96% of the growth.

The findings also reveal a trend for outer London boroughs to have a growing proportion of households – both working and non-working – claiming housing benefit compared with inner London, where the number of people getting help with their rent has decreased since May 2011.

Entitled ‘Tracking Welfare Reform in London', the update also showed virtually all households (97%) affected by the benefits cap in the four London boroughs had children and an increase in the number of households deemed homeless and in priority need.

‘Last year, private rents in inner London rose by 14%, so it's not surprising that more and more working families are turning to housing benefit to help them survive, said chair of London Councils, Hackney Mayor, Jules Pipe.

‘Our latest research shows households claiming housing benefit, both working and non-working, are increasing in outer London and that is placing a greater burden on local services such as schools, transport, and social care,' he added.