The Local Housing Allowance (LHA) scheme
- Fairness - LHA is designed so that two households with similar circumstances living in the same area will be paid the same amount.
- Transparency - Tenants and landlords can find out the maximum amount of LHA available before entering into a tenancy agreement.
- Personal responsibility - In most cases LHA will be paid directly to tenants giving them the responsibility to pay their own rent and manage their own financial affairs.
- Financial inclusion - The government wants tenants to have their LHA paid into a bank account and for them to pay their rent by standing order direct to their landlord. This is a safe and secure method of payment.
Who is affected by LHA?
LHA is paid to tenants in the private rented sector who claimed housing benefit on or after 7 April 2008.
If you were already receiving housing benefit on 7 April 2008 you will only be affected by the regulations if you:
- have a break of over a week in your claim
- change your address - if you rent a room or rooms this includes a change of room or rooms within the same property
Who is not affected?
The rules do not apply to:
- council tenants
- tenants of registered social landlords such as housing associations
- protected cases such as supported housing provided by local authorities, social landlords, charities and voluntary organisations
- tenants whose tenancy began before January 1989
- tenants living in mobile homes such as caravans and houseboats
- tenants living in hostels
- tenancies that the rent officer considers contain a substantial amount of board i.e. meals and attendance
- tenants continuously in receipt of housing benefit before 7 April 2008
- The main changes to how benefit is calculated
Bedrooms not living rooms
The number of bedrooms that a household needs determines the size of property that will be used to set the Local Housing Allowance (LHA) category. The Valuation Office Agency's size criteria determine the number of bedrooms required.
Below you will find out what category of LHA you will come under and how LHA is worked out.
If the rent you pay is less than the weekly LHA rate, you will receive no more than the amount you need to pay for your rent.
The Valuation Office Agency (VOA) sets the rates for each property size according to the number of bedrooms. You can check the maximum LHA you can get at http://lha-direct.voa.gov.uk/search.aspx.
LHA rates for Watford (as of February 2015):
- Shared Accommodation Rate: £78.50 per week
- One Bedroom Rate: £150.00 per week
- Two Bedrooms Rate: £189.38 per week
- Three Bedrooms Rate: £230.77 per week
- Four Bedrooms Rate: £345.00 per week
If you are a landlord you can submit market evidence to help the Valuation Office Agency set the rates.
Claimants aged under 25 years who live alone
Single claimants aged under 25 years are entitled to the standard rate for a room in shared accommodation. This is based on properties where the tenant has a room of their own but shares all or some of the facilities (for example, a living room, kitchen or bathroom).
From January 2012 this will apply to claimants aged under 35 years who live alone. This is known as the shared Local Housing Allowance rate.
How much Local Housing Allowance will I get?
The claim is based on the LHA rate applicable for the month the benefit claim is made. The amount of benefit you will receive depends on your income, savings and circumstances. There is no change to the benefit entitlement rules.
How does the Local Housing Allowance affect landlords?
As well as the amount of housing benefit that can be paid, the main change for landlords is that the LHA will usually be paid to the tenant. The tenant will be responsible for paying the rent to the landlord.
Safeguards will be put in place to protect tenants that may struggle with the responsibility of paying their rent. We have the authority to make payment direct to a landlord where evidence is provided to support this course of action.
Some circumstances where we may decide to pay housing benefit direct to a landlord are:
- If we consider that the tenant is likely to have difficulty managing their own affairs. Examples of this could include vulnerable tenants, such as those with disabilities.
- If we think the tenant is unlikely to use their housing benefit to pay their rent. This could be if we know the tenant has consistently failed to pay their rent in the past.
- If the tenant has built up rent arrears of more than eight weeks, we will decide to make payments direct to the landlord - see the 8 weeks in arrears from, available to download from this page