Local Housing Allowance (LHA)

What is Local Housing Allowance?

From April 2008, a new method of deciding the level of assistance available to tenants of private sector landlords (not Housing Associations) will be introduced. From then, instead of an individual figure for each property, the Rent Service will set a range of flat rates (Local Housing Allowances) for different size households in different localities. When a claim is being considered, the Council will decide the size of accommodation the claimant's household requires, and will then calculate entitlement using the flat rate figure for that size of property, regardless of the actual rent payable.

To find out what the LHA rate will be for particular properties please use the link below for the Local Housing Allowance website of The Rent Service.  This will enable claimants to calculate the number of bedrooms their family needs and search on a postcode to see which Local Housing Allowance rate applies.

What if my rent is more or less than the relevant Local Housing Allowance?

If the Local Housing Allowance award is more than the rent payable, the claimant will be able to keep the difference up to a maximum of £15.00 per week. But if the rent is more than the Local Housing Allowance, the claimant will be required to make up the difference from his own resources.  The benefit is then still means tested according to the claimant’s income and savings as it is now.

Who will any entitlement be paid to?

In most cases, the Local Housing Allowance will be paid to the claimant, not the landlord. The claimant will be responsible for making payments of rent direct to his landlord. However, to protect vulnerable tenants and to reassure their landlords , the Council will have a discretion to pay the landlord. A 'Safeguard Policy' has been set by the Council, which sets out the guidelines within which decisions on this will be made. The policy is shown at the bottom of this article.
 
Applications for payments to be made to the landlord can be made by either party, but there will be a requirement to provide sufficient evidence that the claimant is likely to have difficulty in relation to the management of their financial affairs. Application forms for the use of either the tenant themselves (or someone on their behalf), or the landlord, can be downloaded from the links below.

Who does Local Housing Allowance apply to?

The change will only apply to new claims for benefit made after 7th April 2008, with some exceptions, where an existing Housing Benefit claimant moves after that date or has a break in their claim of more than 1 week.

The LHA rates will be reviewed by the Rent Service each month and will be widely publicised. This means that anybody thinking of renting a property in the private sector (not where the landlord is a Housing Association) and expecting to claim assistance with their housing costs, will know in advance the figure on which their entitlement will be based, and will be able to make informed decisions on which properties are within their financial means.