Liverpool City Council - Local Housing Allowance

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Local Housing Allowance

What is Local Housing Allowance?

Local Housing Allowance is a new way of working out Housing Benefit for people who rent from private landlords (excluding Housing Associations).  Local Housing Allowance starts from 7 April 2008 and is based on the people living in your household and the number of bedrooms required. 

Local Housing Allowance uses a flat rate which is not directly related to your rent charge, so benefit may be higher or lower than your rent charge. In most circumstances your Housing Benefit will be paid to you and not your landlord.

Other circumstances, such as the income and savings that you have coming in or other people living in the household will still affect the amount of benefit paid, so you may not always receive the full rate of Local Housing Allowance. 

Why is Local Housing Allowance being introduced?

Local Housing Allowance is part of the Government's agenda which aims to simplify Housing Benefit and to support the wider objectives for welfare reform.  Further information is available at www.dwp.gov.uk/housingbenefit/lha. 

Will I be affected by Local Housing Allowance?

Local Housing Allowance will affect you if you:  

  • make a new claim
  • change address, or
  • have a break in your claim of at least one week.      

Local Housing Allowance does not affect:

  • customers with a tenancy that started before 1989 
  • Registered Social Landlord tenants (i.e. Housing Association) 
  • some protected cases, such as certain supported housing provided by local authorities, social landlords or charities and voluntary organisations 
  • customers renting a caravan, houseboat or hostel (definition of hostel (PDF [132Kb] opens in new window)) 
  • customers with a tenancy which includes a substantial amount of board.      

If your claim falls into one of these categories your Housing Benefit will be worked out under existing rules.
 
How will my benefit be paid?

Your Housing Benefit will usually be paid directly into your bank account. You are then responsible for paying your rent to your landlord. Only in special circumstances will we pay benefit directly into the landlord's bank account. Special circumstances include tenants who may be unlikely or unable to pay their rent, have rent arrears or are unable to manage their own financial affairs. This might include special circumstances such as issues to do with health, disability or lifestyle 

Each case will be looked at on its own merits.  Further information can be found in our Safeguarding Guidance (PDF [69.7Kb] opens in new window). 

If you are concerned about managing your money or you have debts, try not to worry, but do not ignore your problem - it won't go away.  If you cannot pay your rent because of money problems you may be evicted from your home.  You should ask for help.  There are many local organisations that can give you advice about debt and money problems.  

What if I don't have a bank account?

If you do not have a bank account you will need to open one. Housing Benefit cannot be paid into a Post Office Card Account like some other benefits. You will need to have an account with a high street bank or building society. Further information is available in our leaflet "A guide to basic bank accounts" (PDF [352Kb] opens in new window) or at www.moneymadeclear.fsa.gov.uk 

How are the Local Housing Allowance rates worked out?

The amount of Local Housing Allowance that you may receive depends on:

  • who lives with you
  • the area you live in - known as the Broad Rental Market Area 
  • what money you have coming in 
  • any savings you have 
  • if you share paying the rent with someone else who is not your partner.       

What is a Broad Rental Market Area?

The Rent Service will no longer value individual properties. Instead they will set monthly Local Housing Allowance rates for different size properties within different areas based on the mid point of rent charged by private landlords. These areas are called Broad Rental Market Areas. Each local authority will have at least one Broad Rental Market Area.  There is no right of appeal against the rates. 

How many rooms am I allowed?

Local Housing Allowance rates will be based on the size of the household occupying the property. To calculate the number of bedrooms that will apply for your household you need to count one bedroom for the following people:

  • a single claimant or every adult couple
  • any other single adult aged 16 or over 
  • any two children under age 10
  • any two children of the same sex aged up to 15
  • any other child.      

Example:  Mr and Mrs Smith have two children of the same sex aged 12 and 14.  They would be entitled to the 2 bedroom rate of Local Housing Allowance.

To work out the number of rooms for your household complete our room calculator.

The number of living rooms, kitchens and bathrooms needed in the property is ignored for the purpose of the calculation.  The Local Housing Allowance rates will show you the amount of Local Housing Allowance that will be used to calculate your Housing Benefit entitlement. 

Local Housing Allowance and Large Households

From 6 April 2009, changes have been made to the way Housing Benefit under Local Housing Allowance (LHA) is calculated for large families.

Whatare the changes?

  • New claimants who make a claim for Housing Benefit on or after 6 April 2009 for a house consisting six or more bedrooms will only be entitled to an LHA rate of five bedrooms which will be the maximum payable. 

  • Existing claimants already in receipt of the LHA rate for six or more bedrooms will continue to receive that until their claim is reviewed (usually at the anniversary date of their claim), after which their claim will be re-assessed according to the five bedroom LHA rate for their area. However, for the first 26 weeks after the review (known as the transitions period), the LHA rate payable will be maintained at the higher rate that was paid to them before the review. 
     

  • During the 26 weeks transition period, tenants will be able to exercise choice and look for alternative cheaper accommodation, or re-negotiate their rental contract.

Where there is a change in address, the claim will be reviewed and the appropriate five bedroom LHA rate of the new property will become payable.

Further information

For further information is available in the following leaflets or by visiting one of the websites shown below::

Leaflets

Local Housing Allowance - A guide for tenants (PDF [448.9Kb] opens in new window)

Local Housing Allowance - A guide for landlords (PDF [498.3Kb] opens in new window)

A guide to basic bank accounts (PDF [352Kb] opens in new window) 

Websites

Department for Work and Pensions   www.dwp.gov.uk/housingbenefit/lha

The Rent Service www.therentservice.gov.uk

LHA-Direct https://lha-direct.therentservice.gov.uk

What if I have a query?

You can: