The number of people waiting for social housing in Preston has increased by almost a quarter.
There are now 2,617 people waiting for homes compared to 2,149 this time last year.
The figures, from Community Gateway’s annual report, reflect changes in the welfare system which place limits on the amount of housing benefit available to families.
The so-called ‘bedroom tax’, due to come into play in April next year has led to an increase in demand for two bedroom properties.
A spokesman for Community Gateway said: “The properties that are required or the need for housing has changed quite dramatically due to the welfare reform changes.
“A lot of people who are waiting for houses now just won’t be able to afford three bedroom houses when the changes come in due to caps on housing benefit.”
Community Gateway has increased its supply of affordable housing with a number of new build schemes including Haworth Road and Larches, Ashton, where a number of two bedroom homes have been built to meet the increased demand.
The leader of Preston Council Coun Peter Rankin said the increase in people waiting for housing is a “very serious” issue.
Coun Rankin said: “This is a government issue that is a very, very serious one affecting Preston people.
“We do have a housing advice service and we do our best to try and assist people who have got housing problems.
“It is a big concern.
“We do our best to work with the housing associations to try and make funding available and make land available for further housing.
“The big problem is funding and making funding available.”
He added: “Obviously it is a serious issue that as leader of the council I am concerned about.”