What is Local Housing Allowance LHA

LHA is a new way of calculating Housing Benefit, which will affect claimants who rent properties from private landlords and will take affect on 7th April 2008. Claims will be based on a standard LHA rate determined by the area in which the claimant lives (called the broad rental market area, BRMA) and the household composition.

LHA is for tenants on a low income and will be means tested under current Housing Benefit rules. An application form is still required to clarify the circumstances including income and savings as this will determine the amount of LHA received. LHA will be paid to the claimant, although there are safeguards in place to protect those who are unable to mange their own affairs. If the LHA rate is lower than the contractual rent then it is the claimant’s responsibility to pay the LHA and the shortfall to the Landlord. However if the LHA rate exceeds the rental liability then the claimant will be able to keep the difference, up to a maximum of £15.00 per week.

If you are claiming and under 25 years of age, the restrictions under the current Housing Benefit system still apply.

 

Who is affected by LHA?

LHA affects tenants in the private rental sector who are in receipt of Housing Benefit, although there are some exemptions to this rule (please see list below). Private sector landlords with tenants claiming LHA will also be affected due to the majority of direct LHA payments going to their tenant, instead of the preferred choice of the claimant that is currently in place.

The scheme focuses on mainstream private tenants, therefore the following cases are exempt from LHA:

 

• Registered social landlords
• Protected cases, such as supported housing provided by social services, charities, voluntary organisations, etc
• Pre 1989 regulated tenancies
• Exceptions such as caravans, houseboats and hostels
• Board & attendance cases
• Council tenants
  
  

When will existing Housing Benefit (HB) claims change to LHA

LHA is being phased in; therefore it will not affect all claims immediately. LHA will take place when the following occurs:

 

• When a new claim is made post 7th April 2008.

• When there is a break in a Housing Benefit claim post 7th April 2008.

• When the claimant changes address post 7th April 2008.

Once a LHA claim has been processed the LHA rate used to calculate the claim will remain the same for 1 year, unless an update is required due to a change to room requirement.