According to statistics obtained by Chuka Umunna MP for Streatham thousands of homes in Lambeth are likely to face substantial housing benefit that could force many residents to move from the area.
Nearly five and a half thousand poorer households will see reductions in their housing benefit payments from 2013.
The cuts outlined in the June budget to the Local Housing Allowance mean that housing benefit claimants will only be allowed to claim up to 30% of local rent levels.
More than 1,500 homes will be affected by the move.
Mr Umunna who became the first MP to be born in Streatham and still live in his home constituency commented:
“I am deeply concerned that people in Lambeth will be made homeless or forced to leave the area as a result.
“The Lib Dem Tory coalition Government said it would implement public spending cuts in a way which would not heavily hit the poor and vulnerable – it is doing precisely the opposite with these measures.”