The Local Housing Allowance (LHA) arrangements were introduced from April 2008 after extensive testing in a number of pilot areas. The arrangements apply to people who rent from private landlords.
How the LHA arrangements work
Local authorities use LHA rates based on the size of the household and the area in which a person lives to work out the amount of rent which can be met with Housing Benefit. The local authority also needs proof of a valid tenancy and to take account of a person’s income and savings.
Each local authority is divided into Broad Rental Market Areas (BRMA). Rent Officers set individual LHA rates for each BRMA. These are published by the local authority so that landlords and prospective Housing Benefit customers can be clear about the amount of rent that can be met by the benefit.
If the customer finds a property they like with a rent that exceeds the LHA rate they need, as they do now, to make up the difference themselves. But if they find somewhere with a rent below their LHA rate, they can currently keep the difference up to a maximum £15.
However, from April 2011 the £15 weekly excess that customers can get under the LHA arrangements was removed.