Housing Benefit referral: determination
The considerations of the Rent Officer when determining rents in respect of claims for Housing Benefit.
Accepting at face value
The Rent Officer accepts the information on the application provided by the Local Authority.
Local Authorities refer housing benefit information to the Rent Officer in order for a determination to be made where the case is exempt from Local Housing Allowance.
The information they refer is accepted at facse value, and the determination is made on the basis of the information provided.
If the information is contradictory, the referral may be returned or the LA contacted for clarification. An example would be a room with board in a bungalow, where the room location is given as second floor middle.
There may be referrals where information is given but it seems to be inaccurate, such as a referral of a room with board in an establishment where the Rent Officer knows that the contractual rent is typically £100 per week, but which has been referred at £100 pcm. In such circumstances the Rent Officer should deal with the referred information as though it is correct, but use the remarks section of the determination notice to point out the potential error to the LA in order for them to make a substitute referral, as appropriate.
Changing the referred information
The only circumstance in which a Rent Officer determination may be made on the basis of information which differs from that referred is where the objective property based information supplied is found to be wrong when the case is inspected. An example would be a referral of a 2 bedroom house which is found to be a 3 bedroom house when it is inspected. In such a circumstance the determination should be made on the basis of the facts found at inspection, on the basis of the 3 bedroom house, and the basis of the determination so altered from the referral detail should be made clear using the remarks section of the determination notice.
Previous inspection details
Rent Officers may come across situations where the property was inspected when referred a year ago, for example, when it was described by the inspecting officer as a 2 bedroom house, and yet the current referral is for a 3 bedroom house. Rent Officers should not in such circumstances assume the referral to be wrong – properties may change over time, and rooms may be divided or walls knocked through, changing the number of rooms up or down. If the current case is not being inspected, the decision should be based on the referred detail, with a note in the remarks section of the determination notice to alert the Local Authority to the possibility of an error in the number of rooms referred. The Rent Officer should only base the determination on property details other than those on the referral if an inspection has been carried out for the current case under consideration, and the referral details have been found to be incorrect for the current circumstances of the letting which is the subject of the Housing Benefit claim.
Information which must not be changed
There are other circumstances when referred information is found to be incorrect when the case is inspected. An example may be the household details where the number of children is found at inspection to be different to that referred. Another example may be surrounding the contractual details such as the rent or services amount.
It is important to note that such details should never be changed by the Rent Officer because these details must be verified and determined as appropriate to the claim. Only the LA can alter such details and the Rent Officer must deal with the referral on the basis of the information which the LA has supplied. The Rent Officer can point out the referral detail over which there is doubt and invite a substitute referral to be made, but may not change the referred detail him or herself, except as noted above in relation to objective facts of the property.
Missing ‘non essential’ information
There may be other circumstances in which the referred information is perfectly adequate to make the referral a valid one, but where the referral is silent on information which the Rent Officer needs in order to make their determination. An example would be the referral of a mooring charge where it is unclear whether the rent is inclusive or exclusive of the licence or harbour fee. In this example, where the referral makes no mention of a licence fee the Rent Officer must initially make the assumption that the rent does not include the licence fee. However where the case is inspected and it becomes clear that the licence fee is included, it may be included in the determination. For the Rent Officer to do so would not be to change the referral detail as the referral was silent on the issue. However if the referral had clearly described the mooring charge as exclusive of the licence fee, and the case was inspected and it was found that the licence fee was in fact included, the Rent Officer determination in this case would have to be made exclusive of the licence fee, as it had been referred clearly exclusive of the licence fee, because the Rent Officer cannot change or contradict any details which are related to contractual or household details.
|Referred information||Inspection information||Determination basis|
|Licence fee included||Licence fee excluded||Licence fee included|
|Licence fee excluded||Licence fee included||Licence fee excluded|
|Silent on licence fee||Licence fee included||Licence fee included|
Similarly if the referral is for a caravan, and it is not mentioned whether the site rent is included or not, the Rent Officer should assume that it is not, unless they find it is included at the inspection. If they should find it is included at the inspection, the determination may be made including the site rent and this detail clarified using the remarks section of the determination notice. If it is however clearly referred as excluding the site rent, then even after an inspection which clarifies that it is in fact an inclusive rent, the determination must be made exclusive of the site rent and the issue pointed out to the LA.
Determinations must always be on the basis of the referred information, except; Where property information is found to be different from that referred when the property is inspected Where the referral omits information
Any such basis of determination which differs from the referral must be summarised on the remarks section of the determination notice.
Where other referred details are suspected to be wrong, such as household details or rent referred, the determination must be made on the basis of the referred information, but a substitute referral may be invited to address the suspected error.
- Referral – essential information
- Referral – obtaining extra information
- Inspection pages
- Mooring charges
- Caravan site fees
- Caravans exclusive of site fees
- Errors and substitutes
Board and attendance
Dealing with lettings where the landlord provides meals.
The majority of new Housing Benefit claims made since 7 April 2008 fall under the Local Housing Allowance scheme and will not be referred to the Rent Officer. However there are some exemptions that will be referred; within these are board and attendance cases. These cases are treated in a unique way for referrals to the Rent Officer as the RO has to make an initial determination of ‘substantiality’, and only if the RO thinks there is substantial board will s/he move on to give the full determination.
The Housing Benefit Regulations require the local authority to refer any and every case to the Rent Officer where part of the rent appears to be likely to be attributable to board and attendance. The local authority has no discretion to decide that they already have a current determination from the Rent Officer and apply that to the claim; they must apply to the Rent Officer in every single case. This applies even if the claim for benefit comprises more than one room and also to pre-tenancy determination cases.
The Rent Officer has to determine whether the value of any board is substantial in comparison to the ‘rent payable under the tenancy’. The ‘rent payable under the tenancy’ is the rent referred by the local authority less any ineligible charges. The referred rent may not be the total rent in cases where the local authority have decided that the total rent includes support; in such cases they will have removed the amount of the support charges (although they will tell the RO the gross rent and the amount deducted for support as well as the referred rent).
The initial ‘substantiality’ determination should be done within 5 working days of receipt of the referral, or (particularly if an inspection notice needs to be sent), as soon as possible thereafter. If the level of board is not substantial the Rent Officer notifies the local authority of this and they will then apply the appropriate LHA.
If the Rent Officer determines that the value of the board is a substantial amount of the rent s/he then moves on to provide all the usual determinations (SHR, size and rent, EHR, LRR and SRR, if applicable). Normal VOA and statutory target times apply but the time period starts from the date of the ‘substantiality’ determination rather than the actual receipt of the referral.
The Rent Officer should make suitable research into what, if any, board is provided and this includes making inspections. A central record of these inspections and their findings should be held within the Valuation Team to help with consistency and local benchmark setting (see below under ‘Substantial?’).
If, having decided that there is substantial board, the Rent Officer decides that there is already a determination on the same circumstances for the same property (or location within a property) the Rent Officer can deem that the referral is ‘within 52 weeks’ of another one and send the local authority a copy of the previous determination for them to apply to the claim. However it is only the Rent Officer that can do this, it is not something that the local authority can take on themselves nor is it something that administrative staff within VOA can do. It can only happen once a Rent Officer has made the initial ‘substantiality’ determination.
Both the initial determination that the rent does or does not include substantial board and any full determination of a board case can be the subject of a redetermination.
Board means the provision of meals and includes the element of preparation, service and clearing away; this is classed as attendance. It should also include the provision of crockery and cutlery to eat the food with.
Provision of just food does not constitute board as board must include the element of attendance. Likewise the provision of food, albeit with attendance, at a different site to the living accommodation does not constitute board.
Situations where the tenant is given an allowance for food are not board even if the tenant is supervised when actually buying their food. Likewise situations where the food is bought for the tenant but they prepare and cook it themselves, even under supervision, do not qualify as board. Such situations are likely to occur in supported lodgings type accommodation and Rent Officers should be aware of the potential for tenancies to start as one where board is provided but to change as the tenant becomes more capable, to a supervised self-catering situation. If, on balance, the Rent Officer feels that the majority of the tenancy will be self-catering there is no board; if the opposite is the case there will be board. In some cases it will be impossible to make such an assessment and in such cases the Rent Officer should make their determinations based on the circumstances applicable at the relevant time for the referral. If the situation does change the local authority can make further decisions and referrals in light of the new circumstances.
The provision of a continental style breakfast can be board providing it comes with the requisite attendance. It will be a matter of fact and degree whether a self service style continental breakfast is really board or it falls just short of the line between being just provision of food and proper board.
The Housing Benefit Regulations require referrals to the Rent Officer in all cases where there is board and attendance. There is no provision for referrals where there is no attendance or where there is just attendance but no board. Board includes attendance and must be included in every case referred to the Rent Officer.
‘Substantial’ is not defined in the legislation Rent Officers work to and we have relied for many years on guidance laid down in case law. This tells us that certainly anything over 15% is a substantial element of the total and that anything under 8% is not a substantial element. Rent Officers need to distinguish between the concepts of ‘significance’ (as in ‘significantly high rent’) and ‘substantiality. ‘Significantly’ is a lesser degree of magnitude and older Rent Officers will recall that 5% was often regarded as a reasonable leeway when looking at the SHR determination. ‘Substantial’ implies a far greater element and a good rule of thumb is that anything under 10% is not substantial but anything above 15% is. Within this there is judicial comment that the boundary lies more towards the 15% mark than the 10% one.
The actual determination of whether a board case include substantial board or not is a matter for the Rent Officer concerned taking into account local knowledge and the facts of the individual case. However local offices should aim for consistency and should draw up local benchmarks and baseline figures for application to individual cases.
- LHA – exemptions
- Glossary - HB
Broad rental market areas (local reference rent)
The area for consideration when determining the local reference rent.
The Broad Rental Market Area and the Broad Rental Market Area (Local Reference Rent) are defined within the Rent Officers (Housing Benefit Functions) Order (the Order) and a broadly similar definition applies to the BRMA(LRR) (referral cases) and also the BRMA (for LHA setting). In theory the BRMA and the BRMA(LRR) should be the same, however due to a change in the review process, whilst the implementation of a new or changed BRMA(LRR) may happen immediately the Rent Officer decides to implement the change, the BRMA (for LHA purposes) may only be implemented when or if approved by the Secretary of State. The practical effect of this change may be that the BRMA(LRR) and the BRMA may be different at any one time, and it is possible that the 2 will never coincide if a review to the BRMA is not approved by the Secretary of State.
A BRMA(LRR) is an area:
within which a tenant of the dwelling could reasonably be expected to live having regard to facilities and services for the purposes of health, education, recreation, personal banking and shopping, taking account of the distance of travel, by public and private transport, to and from those facilities and services
The BRMA(LRR) is subject to two conditions. Firstly, it must contain:
residential premises of a variety of types, including such premises held on a variety of tenures
Secondly, a BRMA(LRR) must contain:
sufficient privately rented residential premises, to ensure that, in the Rent Officer’s opinion, the local reference rents for tenancies in the area are representative of the rents that a landlord might reasonably be expected to obtain in that area,
Once determined, a BRMA(LRR) is used by the Rent Officer to apply an LRR to a referred case.
The Rent Officer decisions.
There are three elements to the BRMA(LRR) determinations.
- Access to facilities and services
This element can be approached as two tasks:
- identification of facilities and services, and
- assessment of accessibility to them
For convenience we refer to them collectively as the HERBS:
- personal Banking, and
The Rent Officer should identify and take account of:
- General practitioners, dentists, opticians and pharmacies, health centres and hospitals
- Primary schools, secondary schools and colleges of further education. (Universities should be noted but, as their catchments tend to be regional, national and even international, using them as determining factors is not advised)
- Parks, leisure centres, sports centres, swimming pools, outdoor sports facilities, spectator sports venues, theatres, cinemas, museums, places of interest, restaurants, clubs and other community activities
- Banks, building societies, post offices and automated cash machines
- Convenience stores, shopping parades, supermarkets, high streets, street markets, shopping centres and out of town sites. (Regional centres should be noted but, because their catchments are regional, using them as a basis for a determination is not advisable)
- Rent Officers must consider access to the HERBS identified. The requirement is that a BRMA(LRR) must offer reasonable access to them by both public and private transport. The Order requires consideration of the “distance of travel” and, inevitably, “distance” is commensurate with ‘time’. If journeys take an unreasonable time, for the tenant of a dwelling or a potential recipient of an allowance, it is likely that an area is too broad
In the context of determining area boundary, access to some HERBS will be influenced in one direction while access to others will be influenced in another. Rent Officers should therefore strive to exercise careful judgement when determining boundary. The important thing is that the tenant of a referred dwelling has reasonable access to the HERBS and that people living across an area share a reasonable level of access to them.
The use of the word “reasonably” in the definition exerts a limit on broad extent. ‘Reasonableness’ is a concept that allows public bodies to exercise discretion in following Parliamentary intentions but, at the same time, restrains officials from exceeding those intentions. It is impossible to provide a precise definition of reasonableness that could cover every situation. The provision of good transport links means an area is justifiable when someone enjoys access to a not unreasonable degree. In a broad area context, the term “reasonable” may vary. For example, people in rural locations expect to travel greater distances to access HERBS than people in urban locations.
2. Variety of property types and tenures
This element represents a checking mechanism, or test, after the consideration of the primary HERBS element.
The requirement is straightforward and requires Rent Officers to ensure that an area contains an assortment of property types (e.g. houses, flats, bungalows, terraced, semis, detached, purpose built and converted). Rent Officers may also consider whether other, less usual, types of dwellings are present, such as caravans or caravan sites, boats or moorings. Rent Officers must also ensure a variety of tenures such as owner occupation, local authority renting, social renting and private renting.
3. Sufficient privately rented premises
This element represents the second test to be satisfied. It requires Rent Officers to ensure that the private rented sector identified in the “variety” test is adequate to support an LRR representative of the market.
Broad areas will not resemble each other in every way. The private rented sector, for example, is far from evenly spread; it tends to be concentrated in the urban areas and scattered unevenly throughout rural ones - in many places it is non existent. It is not, therefore, the intention of this guidance to attempt to settle on an amount of privately rented premises that could serve as a benchmark and meet the test for all broad area determinations. Rent Officers have a responsibility to use their judgment and, taking account of the relevant factors, reach an informed opinion.
If, in a bid to address deficiency, Rent Officers wished to increase an area’s extent, they would need to revisit the primary consideration of accessibility to the HERBS. However, the Order also requires that where Rent Officers, in a densely populated conurbation for example, wished to decrease an area’s extent in order to address perceived excess, they would need to revisit the view that the area is broad: i.e. wide in extent, large in expanse, or spacious. The key issue here is thus one of applying checks and balances, and sufficiency therefore needs to be considered within the context of the Order as whole.
Since Rent Officers have to collect lettings information on which to base the LRR, it may be reasonable for us to quantify, in general terms, the amount of lettings information Rent Officers can expect to collect. Lettings information representing 20% of the private rented sector should provide a reliable representation of a broad rental market. (It should be noted that the size of the Private Rented Sector (PRS) cannot be determined by the amount of lettings information that the VOA holds – the extent of the PRS must be independently assessed by using other data such as census data.)
Where Rent Officers identify an insufficient number of dwellings for a required room category, they may import lettings information from similar areas. The important point to note is that, as it is the Rent Officer’s duty to decide what constitutes sufficiency for a broad area, it would be reasonable to consider only the most generally available room and bedroom categories of property when forming an opinion of general sufficiency.
It is in such ways that Rent Officers exercise judgement as to whether an area contains sufficient private rented lettings for an LRR to be determined that is representative of what a landlord could reasonably expect to obtain in a broad area.
Broad areas are generally agreed by Rent Officers but a Rent Officer determining an LRR must be satisfied that the assessment of BRMA(LRR) is appropriate. If a Rent Officer, particularly where a redetermination is involved, is not satisfied that the BRMA(LRR) is appropriate to the case, another BRMA(LRR) should be determined - the Rent Officer has a duty to exercise judgement and supply reasons for the redetermination of BRMA(LRR). This would involve consultation with other Rent Officers.
Generally agreed broad areas are subject to periodic review. The VOA has a Business Plan commitment to conduct regular reviews of BRMAs and BRMA(LRR)s.
- Determinations - local reference rent
- Determinations - single room rent
- Broad rental market area (for LHA purposes)
What constitutes a caravan or mobile home.
The definition of what constitutes a caravan is often misunderstood, and does not simply apply to accommodation with wheels attached that can be towed by a car or other means. So far as the law is concerned, a park/mobile home, a caravan holiday home, touring caravan or Gypsy and Traveller home are all capable of coming within the legal definition of a caravan provided they retain the element of mobility.
Mobility means that the caravan must be capable of being moved when assembled, from one place to another, or to a different site. The physical movement need not be by means of towing with a car or other vehicle. It may involve movement by specialist equipment such as lifting gear, lorry or low-loader. The crucial element is that to meet the definition of ‘caravan’, it may not be fixed to the ground. Permanent works, such as a large porch or extension, which fix the caravan to the ground could mean that a caravan no longer comes within the legal definition of a caravan and could as a consequence be treated as a building.
Where a caravan is permanently affixed to the ground, this potentially has serious planning, legal and contract implications for site owners and residents. Site owners could be in breach of planning permission for the site, and residents of park homes would lose their protection under the Mobile Home Act 1983.
The connection of mains water / electricity / sewerage or addition of cosmetic skirts that do not fix the accommodation to the ground do not prevent the accommodation from coming within the definition of a caravan.
Legal definition of a caravan
Section 29 (1) of the Caravan Sites and Control of Development Act 1960 a caravan is defined as
”… any structure designed or adapted for human habitation which is capable of being moved from one place to another (whether by being towed, or by being transported on a motor vehicle or trailer) and any motor vehicle so designed or adapted but does not include:
a) Any railway rolling stock which is for the time being on rails forming part of a railway system, or
b) Any tent.”
This definition was modified by Section 13 (1) of the Caravan Sites Act 1968 (“The 1968 Act”), which deals with twin-unit caravans. Section 13 (1) provides that a caravan is:
“A structure designed or adapted for human habitation which: a) Is composed of not more than two sections separately constructed and designed to be assembled on a site by means of bolts, clamps or other devices;
b) Is, when assembled, physically capable of being moved by road from one place to another (whether by being towed, or by being transported on a motor vehicle or trailer), shall not be treated as not being (or not having been) a caravan within the meaning of Part 1 of the Caravan Sites and Control of Development Act 1960 by reason only that it cannot lawfully be moved on a highway when assembled.”
Section 13(2) of the 1968 Act also prescribes the following maximum dimensions for “twin unit caravans”:
(a) length (exclusive of any drawbar); 60 feet (18.288 metres);
(b) width: 20 feet (6.096 metres);
(c) overall height of living accommodation (measured internally from the floor at the lowest level to the ceiling at the highest level): 10 feet (3.048 metres).
From 1 October 2006 in England The Caravan Sites Act 1968 and Social Landlords (Permissible Additional Purposes) (England) Order 2006 (Definition of Caravans) (Amendment) (England) Order 2006 [SI 2006 No 2374] further amended section 13(2) of the Caravan Sites Act 1968 by increasing the maximum dimensions of a structure that can be defined as a “twin unit caravan” to:
(a) length (exclusive of drawbar): 20.00 metres (65.616 feet);
(b) width 6.80 metres (22.309 feet);
(c) height: 3.05 metres (10.006 feet).
Subsequently these revised dimensions have also been adopted by the National Assembly for Wales.
When considering whether or not lettings information falls within the statutory definition of a caravan, the Rent Officer must consider the actuality of the accommodation in question. The accommodation cannot be considered to be a building (such as a bungalow) unless it is physically and permanently affixed to the ground and is incapable of being moved.
Connection of services do not constitute permanent fixing of the accommodation as in most cases they can be simply disconnected to facilitate movement.
Similarly, brick skirts around the base of a mobile home would not constitute permanency if the accommodation could be moved using specialist apparatus.
If the accommodation was mounted on integral fixed foundations, then it could be said to be permanent. Similarly, if the accommodation exceeded a twin unit of the maximum dimensions in legislation, then it would fall outside the definition of a caravan.
- Caravans excluding site rents
- Site rents
- Lettings research pages
Caravan site fees
Dealing with applications where the charge is for renting the site upon which a caravan or mobile home may be placed.
Caravans and site rents may be referred to the Rent Officer in a number of different ways. If the claimant owns their dwelling or pays site rent and caravan rent to different landlords, the site rent referral will be received separately. If they rent the dwelling and site from the same landlord, the single referral should include both elements. Referrals where the site rent is included are exempt from a determination under the size criteria, or size and rent determination.
Site rents are dealt with differently from other determinations under the Rent Officers’ Order as “special cases” and there are slightly different procedures. From the 6th April 2009 onwards there were changes in Housing Benefit Regulations relating to Gypsy site rent referrals which are explained in detail below.
Valuing site rents
Housing Benefit is payable for site fees for mobile homes. Special rules apply to the treatment of determinations for these. The Rent Officers Housing Benefit Functions Order is modified at Schedule 4 and - it tells Rent Officers to deal with site rents differently. The main effect is that comparable evidence must be of “payments in respect of a site” and other comparable rents cannot be used. Rent Officers and RDO’s must not use rents of ‘dwellings’ in any ‘Significantly High’ site rent determination. They make the same set of determinations for site fees as they do for any other referral, except that they do not operate the Size Criteria – so no size notional determination must be made.
When RO’s/RDO’s are making the Significantly High Rent test for a site fee they must only use evidence of other site fees. The LRR determination may ignore the requirement to consider the number of rooms. All pitch fees or site rents for all sites in any BRMA(LRR) should be considered when determining the LRR. Of course this may involve extrapolation of site rents from outside the subject BRMA(LRR). Sheds, shower blocks or other communal facilities are not relevant for LRR purposes.
Site rents tend to be standard charges for each site. However, if there is evidence that the charges are different for different sizes of dwelling, RO’s/RDO’s must reflect this in their Significantly High Rent determination, but not for the LRR. There may be a sliding scale of charges on a site, so RO’s/RDO’s should ensure that they are comparing like-with-like when valuing these cases, and that the LRR is based on the lettings information for all sites and all fees in the BRMA(LRR) and all sites and all fees in any extrapolated lettings information from outside the subject BRMA(LRR).
For example, if a site charges £20 per week as a site fee for a 2 bed dwelling, and the same site has larger pitches for which it charges £30 per week for 3 or 4 bed dwellings, then the significantly high rent determination should seek to compare the referred site rent with similar sized site rents across the BRMA(LRR) and if necessary extrapolating from beyond the subject BRMA(LRR). However when determining the LRR for the referral, site rents for all sizes of pitch (including so called ‘double plots’) should be included in the list of rents compiled from across the BRMA(LRR) from which the LRR is determined.
Rent Officers are required to determine an appropriate area over which to look at the evidence for the determination of a local reference rent. The area for the Rent Officer to consider will initially be the same broad rental market area as that determined and generally agreed for other types of accommodation. While there always remains a possibility that the Rent Officer may decide that a different area should be determined as the BRMA(LRR) in any case, it is expected that the agreed predetermined BRMA(LRR) will be applied in all but the most exceptional cases, and that if considering that there may be sufficient grounds to apply a new BRMA(LRR), then the Rent Officer must consult line managers and get agreement at Band 3 level before determining a ‘one off’ BRMA(LRR).
The primary issue is that the BRMA(LRR) should comply with the requirements of being an area within which there is reasonable access to the HERBS facilities (for health, education, recreation, banking and shopping) containing a variety of types of residential premises, held on a variety of tenures, and that it should contain sufficient privately rented premises to ensure that the resultant LRR is representative of a rent which the landlord might reasonably expect to obtain in that area.
Rent Officer teams must use all the available evidence. In most cases, the evidence of values is readily obtainable. Some sites offer off-season or winter accommodation rates to benefit claimants and some deal specifically with ‘travellers’. RO’s/RDO’s must make a careful assessment of a genuine free market in these cases. Evidence of rents from tourist sites must not be taken into account unless people are occupying the sites as their homes. Site rents paid by holidaymakers should be treated as supporting information only – it should not be used as transactional evidence.
Gypsies and travellers
In this context “gypsies and travellers” means—
(a) People with a nomadic cultural tradition, or people who have a background involving living in a caravan; and
(b) People with a nomadic way of life, whatever their race or origin, including—
(i) people who, due to their own or their family’s or dependant’s educational or health needs, have stopped travelling; and
(ii) members of an organised group of travelling show people or circus people
With effect from 6th April 2009, schedule 2 of the Housing Benefit Regulations is amended to identify all exempt cases not referred to the Rent Officer under Regulation 14. The effect of this amendment is to categorise County Council owned sites and local authority owned sites where the claimant rents the site from the local authority and the caravan from a private landlord as “Excluded Tenancies”.
Excluded tenancies can be referred to the Rent Officer only where the local authority states that the claimant is unreasonably over accommodated or that the rent is unreasonably high. Where a local authority wishes to refer site rents under this provision, it must state a reason for referral.
Any Gypsy site rents referred to the Rent Officer (either under one of the above two reasons, or where the landlord is not the County Council or local authority, since 6th April 2009) must be valued in exactly the same way as any other site rent. Any rent for a caravan which is situated on a Gypsy site must be valued in exactly the same way as any other caravan on any other site. (See “Valuing Mobile Homes and Caravans” below.) Referrals for renting caravans or mobile homes (rather than site rents) may be made in the normal manner (they were not affected by the April 2009 change) as long as the referred rent does not include any element of site rent paid direct to a County Council or local authority.
For clarity, some example scenarios are set out below;
Gypsy site rent referred, landlord is County Council, no reason given. Rent Officer should return the referral “outside scope of scheme” asking for a reason for any re-referral to be given.
Caravan and site rent referred, site rent paid direct to County Council. Rent Officer should return the referral “outside scope of scheme” asking for the caravan rent to be re-referred separately, and for a reason for the site rent re-referral to be given.
Gypsy site rent referred, rent paid to third party who sub-let the Gypsy site from the local authority. Rent Officer should provide a determination in the normal way because the claimant’s landlord is the third party and is not the County Council or local authority,
The RO/RDO’s duty is to reflect the market. While it is difficult to obtain evidence of Gypsies or travellers paying their rent without obtaining housing benefit, it is not impossible to do so. Local authority HB sections will know exactly how many families on a site obtain HB. A discussion with them and the council’s Gypsy liaison officer may help reveal the number of those occupants of a site who do not apply to the council for assistance with their rent. Between them, they will be able to give this valuable information, including their own sites which may never be referred to VOA, but which can provide useful transactional evidence.
Gypsy and traveller sites often include many extra facilities and services, which are expensive to provide. These may include additional site management, maintenance, clearance costs, fencing and security. Additional services will frequently include education facilities for children, resolving disputes on site and with neighbours, and personal support (help with claiming HB for example). All these additional items will be included in the SHR decision, which could be much higher than for other caravan sites.
But again, the LRR determination will include evidence of all site rents, not just Gypsy sites. The ‘H’ and ‘L’ must be linked to actual transactions of site rents in the non-HB market, whatever the circumstances. RO’s/RDO’s must be able to demonstrate that link clearly and transparently. The whole range of rents used to determine the LRR may include supporting evidence, but the ‘H’ and ‘L’ points must each relate to identifiable transactions in the range of evidence being considered for determining the LRR.
Again the Broad Rental Market Area (Local Reference Rent) should above all satisfy the test of having reasonable access to the HERBS facilities (for health, education, recreation, banking and shopping), as well as containing a variety of residential property held on a variety of tenures, and having a sufficient amount of privately rented accommodation for the resultant LRR to reflect a rent which the landlord might reasonably expect to obtain.
Valuing mobile homes and caravans
Where a tenant pays rent for the caravan or mobile home itself including the site rent (as opposed to just the site or pitch fee alone) RO’s/RDO’s must deal with referrals for them as any other case, apart from refraining to apply the size criteria or applying a size notional or size and rent determination. Rents of caravans or mobile homes are compared with rents of similar caravans or mobile homes in similar condition for the Significantly High test. Most market evidence for caravans and mobile homes includes a site rent element – in other words, most are sited vans/homes and there is normally only one single rental payment. Although it may be possible to identify the two parts of the rent RO’s/RDO’s should include both elements of rent in one set of determinations (unless the site rent is on a Gypsy site and is paid direct to a County Council or local authority – see “Gypsies and Travellers” above). This is consistent with the Order, as amended.
The LRR or SRR used for a caravan will include comparable evidence for all other dwellings, including bricks and mortar lettings, in the BRMA(LRR) with the right number of rooms for the claimant. The BRMA(LRR) used should be the same BRMA(LRR) as for conventional accommodation. Any Exceptionally High notional rent will be on the same basis – using evidence of all appropriate size dwellings, but from within the neighbourhood only.
Paying rent for caravan and site to different landlords
Where a tenant pays rent for a caravan or mobile home to one landlord, but pays the site or pitch fee to a different landlord there are several possibilities. If the tenant is claiming HB for both payments the L/A normally refers the two parts separately. RO’s/RDO’s should then make their determinations for each part separately – following the guidance above.
It should be borne in mind that if the site rent is for a Gypsy site and the landlord is a County Council or local authority, the guidance given above in the gypsy sections must be followed.
Where SHR determinations are made for the caravan part only care should be taken to remove the site fee part of any market evidence collected which includes both caravan and site fee together. Please see the separate handbook page ‘Caravans exclusive of site fees’.
If the tenant is only claiming HB for one payment, or if only one of them is eligible for HB, the L/A should send a referral for that payment alone. The RO/RDO should then make their determinations in relation to that payment only.
Site rent cases typically use the same BRMA(LRR) as other cases.
Specifically suitable alternative sites, possibly extrapolated from outside the BRMA(LRR), should be considered when determining the SHR. This is often necessary for gypsy site referrals.
All sites across the BRMA(LRR), and possibly extrapolated from outside the BRMA(LRR), should be used to determine the LRR.
- Mooring charges
- Caravans exclusive of site fees
- Size notional
Caravans exclusive of site fees
Dealing with applications where the rent is for the caravan alone.
Most lettings information for caravans and mobile homes includes a site rent element – in other words, most are sited vans/homes and there is normally only one single rental payment.
However, where a tenant pays rent solely for a caravan / mobile home (not including any site rent / pitch fee) Rent Officers must deal with housing benefit referrals for them as any other case. Rents of caravans or mobile homes alone are compared with rents of similar caravans or mobile homes in similar condition for the Significantly High and Size Criteria tests.
There are circumstances in which the caravan is rented entirely separately from the site rent element, the rent being paid to a different landlord, under a separate agreement. Local Authority Housing Benefit Departments may refer such cases separately, where the one referred rent is for the caravan or mobile home alone, exclusive of the site rent element, and the other referred rent is for the site rent alone.
These are acceptable referrals if the landlord of the van is separate from the landlord of the site – separate referrals are appropriate only where payments are made to different landlords. These are sometimes referred as Pre-Tenancy Determinations, and they present particular valuation challenges to the Rent Officer.
Pre-tenancy determinations (PTD) referrals are sometimes for vans which are not yet on site. In this instance the RO should get full information regarding the type and size of van to be placed on the site, including the plot size to be used. This information should then be included in the remarks section of the determination, using wording similar to the following;
“This determination is for a new 35’ Weatherby mobile home ONLY occupying a single plot at the referred address and properly connected to site plumbing and electricity supply”.
This approach avoids the problem of the landlord supplying older less well appointed vans after receiving a RO pre-tenancy determination amounting to less than the referred rent.
The issue of mains connections has caused some confusion. Where a PTD is received the assumption normally made in relation to the determination is that the dwelling will be supplied connected to whatever mains services the site provides to its pitches. The most important thing is to make clear on the determination decision, the basis on which that determination has been made.
Separate referrals for site rent and van rent also present a fundamental valuation problem concerning the comparison of like with like. When determining the ‘significantly high rent’ determination care should be taken to ensure that the evidence used for comparative purposes is exclusive of any site rent element, or that adjustments are made to the evidence which is inclusive of a site rent element, to remove that element. If the referral is exclusive of the site rent then the evidence must be exclusive of the site rent.
This is not to say that the dwelling is to be valued without any consideration of its location – even if it has not yet been sited. The value of any dwelling has to take account of location. Location is often quoted as the prime driver of rental or capital value. The rental valuation of a caravan exclusive of site rent will be exclusive of the normal charge for siting it on that pitch but it must still take account of the location. That is why you may find identical makes and models of caravan with different valuations of rent for different locations, despite all being exclusive of site rent. This may be because of differing amenities, including mains services to each pitch, views, local market conditions, or any number of other variables, which may not always be fully reflected in the differing site rents.
It should also be noted that the value of the two separate elements, caravan rent and site rent, may not necessarily be equal to the value of a single letting including both elements. The key is to base the valuation determination on the closest possible comparable evidence available.
The ‘significantly high rent’ principles hold for the determinations of ‘size and rent’ and ‘exceptionally high rents’ which must consider ‘the dwelling’ and ‘the tenancy’, and the evidence must therefore be fully comparable, so if the referred rent is exclusive of site rent then the evidence used must be exclusive of site rent.
Local reference rent
However, the determination of Local Reference Rent is a determination which is for “an assured tenancy of a dwelling” which meets the size criteria, and so the evidence which is to be listed in rent order to determine the LRR may include both rents which are inclusive of a site rent and rents which are exclusive of a site rent, and should include both where we hold open market evidence of both.
Of course, the LRR for a caravan will depend on lettings with the same number of rooms, so will also include all the usual bricks and mortar lettings for dwellings with the appropriate number of rooms as well.
For clarity, this means that the LRR for referrals inclusive of site rents and exclusive of site rents will be the same LRR. However the determination of SHR, and the notional determinations for size and exceptionally high rent, may differ from those including site rents, as the evidence used for referred rents exclusive of site rent must be (or be adjusted to be) exclusive of the site rent element.
As far as lettings information is concerned, there is a spreadsheet which contains all the LI for caravans and mobile homes in a central (‘shared drive’) location for all Rent Officers to access.
It is clearly important when recording the LI to ensure that the information as to whether a caravan or mobile home rent is exclusive or inclusive of the site rent element is included. Without this information it will not be possible to compare like with like accurately for the property specific determinations (significantly high rent, size notional and exceptionally high notional).
Some areas, despite the best efforts of Rent Officers to collect it, will have a dearth of evidence because there are few (or no) sites for caravans or mobile homes in that area. If a case is then referred in that area, the allocated Rent Officer will have to rely on valuation techniques other than the direct comparable method normally relied upon.
Extrapolation and interpolation may be techniques employed. Looking at lettings information for similar lettings in a similar area but beyond the subject BRMA would be the preferred approach in these circumstances.
As regards comparison with evidence of bricks and mortar lettings, this would be a less reliable technique but may be employed as a check. Having carried out the comparison exercise as above, the figure which the RO is minded to value the subject caravan letting at may be checked by looking at the differential between it and an equivalent sized flat in the same area, and ensuring the differential is similar to that for a caravan and an equivalent flat in the similar area.
Bricks and mortar lettings information is rarely relevant to caravan and mobile home rents, although if we are aware, having regard to actual evidence, that caravans or mobile homes are let at lower rents than, say, flats or terraced houses nearby we should look critically at any rents referred that are higher than the local bricks and mortar values.
- Caravan site fees
- Significantly high rent determinations
- Size and rent determinations
- Exceptionally high rent determinations
- Local reference rent determinations
Carers and size criteria
Allowing for an Additional Bedroom (reflecting a change in rules from 1st April 2017)
The size criteria detailed in the Rent Officers (Housing Benefit Functions) Order as amended allows rent officer determinations to make allowance for one additional bedroom where a claimant and/or their partner and/or a child or children have a proven need for overnight care and this is provided by a non-resident carer.
This applies to all Housing Benefit claimants who fall within the qualifying definitions. For existing claims the application of these rules may trigger a new rent officer referral or the application of a new LHA determination, which means a new anniversary date may be set for these cases.
The provision follows modifications of the size criteria in the Rent Officers (Housing Benefit and Universal Credit Functions) Orders, and the Housing Benefit Regulations. All the normal determinations under Schedule 1 still apply to the case, including the significantly high determination. For the extra bedroom provision to apply there must be:
- an entitlement to an overnight non-resident carer as identified by the local authority,
- a carer provided, who must be non-resident, so not already a member of the claimant’s household,
- an extra bedroom within the claimant’s accommodation, not used by any other member of the claimant’s household. A tenancy where the dwelling is already fully occupied, cannot qualify for the allowance of an additional bedroom in the rent officer’s determination.
The extra room entitlement only applies to bedrooms, so the non-resident carer is not counted as an occupier for determining the total number of living rooms permitted under the size criteria.
When to apply the allowance
It is the local authority’s responsibility to decide whether an overnight non-resident carer is to be included in the household. If so, a referral should be made to the rent officer where this represents a change of circumstances. Local authorities have been asked to adopt a standard method of referral for these cases. They should:
- include the carer under the claimant’s household details, but
- give the name as “carer”, and
- the relationship to the claimant as “non-dependant”.
How to apply the allowance
VICTER has not been amended to accommodate the changes which means rent officers MUST manually check and amend the size notional “number of rooms” for these cases on the V4 decision screen. Otherwise V4 will include the carer in the calculation of room entitlement, and therefore, in some cases (specifically where the carer’s inclusion would otherwise trigger the allowance of an additional living room), V4 would default to show the wrong number of rooms for size criteria and LRR purposes.
Help with the extra room will also be available to those who live in a property that is shared with other tenants, where the claimant rents exclusive use of one room in a shared dwelling, and where they also receive care and there is a bedroom that is used by a non-resident carer. The approach in this situation is to value the accommodation as if it were a letting of two exclusive rooms in a shared house, although the rental value is likely to be less than the value of 2 single room lets added together.
In such cases the local reference rent (LRR) allowed should be the 2 room LRR. There is no LRR for 2 rooms in a shared house so the category is a letting where there is exclusive use of no more than 2 rooms. The Department for Work and Pensions has clarified that in this situation where the tenancy is of a single room but a carer uses a spare room in a property, all of the tenants eligible to claim Local Housing Allowance in the property are able to claim a two room LHA rate. For example there may be three tenants living in a four bedroom house, the fourth bedroom is occupied by a carer who provides care services to the three tenants. Each of those tenants will be entitled to the two room LHA. Likewise if a referral is received for the same scenario all of the tenants will be eligible to receive a two room LRR determination.
Again V4 does not accommodate these changes and in most cases will pre-populate the decision screen with the ‘shared room LRR’ (applicable to lettings of a room in a shared dwelling) so rent officers will need to remember to override the LRR because it is the two room LRR that should be allowed. In some instances board may be included so the board LRR will be given, this again should be amended to the two room LRR. We are aware that in some cases this could actually result in a rent decrease as the board LRR could potentially be higher than the two room LRR in some areas.
The provision for an extra bedroom for a non-resident overnight carer does not apply over and above the property size cap of four bedrooms in LHA cases. This does not affect cases referred to the rent officer, the extra room entitlement may result in a determination, including of a local reference rent, for more than four bedrooms in these cases.
- size criteria
- size notional
- local reference rent
- local housing allowance
Claim related rent
The lowest of the significantly high rent, the size and rent and the exceptionally high rent.
The claim-related rent is the lowest of the following Rent Officer determinations:
- the significantly high determination
- the size and rent determination
- the exceptionally high determination
and could be the rent the tenant pays.
It is net of all ineligible service charges except meals and does not include water or sewerage charges.
Victer automatically calculates the claim-related rent.
- Determinations – significantly high rent
- Determinations – size notional
- Determinations – exceptionally high rent
Notices to Local Authorities giving the Rent Officer determinations.
Having made determinations, Rent Officers must give notice to the local authority of:
- The claim related rent
- The total amount of ineligible charges, other than meals (unless the dwelling is in a hostel)
- Whether the claim-related rent includes an amount for meals (in practice we will continue to say which meals are provided but not give values for them)
- Either the local reference rent determinations or a statement that the LRR is the same as or more than the claim-related rent
- If the local authority asked for a single room rent determination either the single room rent determinations or a statement that the SRR is the same as or more than the claim-related rent
The notification will also say which valuations “bite” in the claim-related rent but will not give the amounts.
Once the Rent Officer has made all the determinations and they are entered on the IT system it will generate the notification.
- Services - ineligible
Exceptionally high rent
The highest reasonable rent for similar lettings which are not at the upper end of the market.
This is the third series of determinations that we have to make, once Rent Officers have made the significantly high determinations and the size and rent determinations.
We must decide if the lowest of the determinations previously made is exceptionally high compared to other rents within the neighbourhood.
There are some key points to take into account in making the exceptionally high rent determination
- This determination is not property specific
- Compare the rent with those of assured tenancies (which may include some licences) for properties in the same neighbourhood with either
The same number of rooms as the subject property; or
If the claimant is over accommodated, the right number of rooms, according to the size criteria
- Ignore property type and tenancy details; look only at the number of rooms. When dealing with one room accommodation, all evidence of one room lettings are looked at together for exceptionally high, irrespective of property type
- Evidence should be drawn from the neighbourhood. Where the dwelling is in a town or city, the part of the town or city where the dwelling is located which is in a distinct area of residential accommodation. Otherwise, it is the area surrounding the dwelling which is a distinct area of residential accommodation and where there are like dwellings of the appropriate size in reasonable state of repair
A neighbourhood could be:
A small town, or
Part of a larger town or city. It will have a well known name or names, such as particular wards or parishes, or
A group of villages or hamlets. You will be able to group the names together to define the neighbourhood. Or
A large tract of sparsely populated countryside
A neighbourhood must be easy to identify – using the definitions above it should be easy to give them names. For example, “Anytown”, “North Bigtown”, or villages “A, B, C, and D”.
- The determination of a rent for a property not exceptionally high assumes that the property is in a reasonable state of repair
- As with all valuations, the determination should be supported by lettings research information. Rent Officers should look at all the local factors and amenities which influence local rent levels. They should also be aware of comparable evidence in the broader surrounding locality
- The point where a rent is determined as exceptionally high is not necessarily the same as ‘H’ for local reference rent (LRR) purposes. The “H” is for the locality, while the exceptional determination is based upon the neighbourhood
- BRMA for LRR and LHA
- Determination - significantly high rent
- Determination – size notional
Dealing with claims which may involve fraud.
Housing Benefit referrals - suspicion of fraud
Any member of VOA staff who, after carrying out (or attempting to carry out) a Housing Benefit inspection, is suspicious that Housing Benefit fraud may be being committed should report this to their Valuation Team Manager (VTM). The VTM will then, dependant on the exact circumstances, decide whether this suspicion should be referred to the local authority. It would be appropriate for the VTM to contact the relevant HB Manager or Fraud Investigation Team on the phone to discuss the suspicion verbally and, if they agree that the suspicion is worthy of formal reporting, the suspicion should be reported to the LA by either a note in ‘Remarks’ on the determination or an e-mail from the VTM setting out the material points. This suspicion does not need to be substantiated and the LA concerned is responsible for following up the report and making any further investigations and decisions.
The VTM should keep a record of all fraud reports and, where available, feedback from the Local Authority fraud investigation team.
Where a Housing Benefit decision has been made and access to the property has not been obtained the Rent Officer should always record that they have been “Unable to gain access although appointment made” in the ‘Remarks’ box of the additional notes on the final Housing Benefit decision screen on VICTER.
Where access has not been obtained following a notice of inspection, Rent Officers should leave a note explaining that they called and a decision will be passed to the local authority on the details contained in the referral. There is a note which must be used to leave at the address in the forms and letters section of the guidance intranet page.
Similarly where the Rent Officer has actually been denied access they should record that in ‘Remarks’. (This means where access to the property has been refused by the claimant, rather than there simply being no answer at the door.)
Discrepancies between referral and situations observed on inspection
The ‘Errors’ page of the Rent Officers’ Handbook explains what to do when there are differences between the details on a referral and what is found at an inspection. It is possible that some of these differences could be connected with fraud but some may not be, so it is important to follow current guidance carefully.
Fraud awareness raising
VTMs may make arrangements with Local Authorities for Rent Officer members of their team to attend a fraud awareness briefing, where these may be available. If any team members who are required to visit properties have not received a briefing, then the VTM may raise the issue as a learning need and explore the possibility of accessing information through alternative local authority Housing Benefit departments. Redetermination officers based in local offices should be offered the opportunity to attend any such sessions arranged by local VTMs.
- Errors and substitutes
- Errors – correcting
- Inspection criteria
Dealing with application where the letting is in a hostel.
In terms of the Rent Officers’ Housing Benefit function the word hostel has a very specific meaning. In the HB regulations “hostel” is defined as –
A building with domestic accommodation, other than separate and self-contained accommodation, where board or facilities for the preparation of food are provided and which is -
- Managed or owned by a registered housing association; or
- Run on a non-commercial basis with some central or local government funding; or
- Managed by a voluntary organisation/charity providing care, support or supervision assisting people being rehabilitated or resettled within the community
A hostel is not –
- A care home
- Independent Hospital; or
- An Abbeyfield Home
The LA must decide whether accommodation falls within the specific definition of a hostel. If it does they must tell us on the referral because referrals for rooms in hostels are treated differently to “normal” referrals in several ways:
- Rent Officers should only make a decision for a room in a hostel once in every 12 month period. The local authority can apply that decision to any other similar rooms during this period, assuming there has been no relevant change of circumstances that has affected the dwelling. In this respect a room should be regarded as similar to another if it provides sleeping accommodation for the same number of people
- Rent Officers do not make exceptionally high, local reference rent or single room rent determinations for hostels
- Referrals should generally be treated at face value, so if the LA says ‘hostel’ it should be treated as such. If you feel it is not a ‘hostel’ a determination should still be provided but a comment can be made in remarks
- Essential referral information
Houseboats excluding mooring charges
Dealing with applications where the charge is for renting a houseboat alone.
Valuing boats used as dwellings
Where a tenant pays rent for the boat itself (as opposed to just the mooring fee) Rent Officers must deal with housing benefit referrals for them as any other case. Rents of houseboats or vessels used as dwellings are compared with rents of similar vessels in similar condition for the Significantly High and Size Criteria tests. Much market evidence for such vessels includes a mooring fee element – in other words, most are moored vessels and there is often only one single rental payment.
However, there are circumstances in which the vessel is rented entirely separately from the mooring element, the rent being paid to a different landlord, under a separate agreement. Local Authority Housing Benefit Departments may refer such cases separately, where the one referred rent is for the vessel alone, exclusive of the mooring element, and the other referred rent is for the mooring fee alone.
‘Continuous cruisers’ are vessels which are regularly moved from one short term mooring to the next, never staying in any one mooring for more than 14 days. This avoids a permanent mooring and hence avoids the requirement for an associated licence fee. Essentially the Rent Officer is not concerned with whether the referred vessel is a continuous cruiser or not, but rather needs to know what is being paid by the ‘tenant’ and what is being supplied by the ‘landlord’.
These are acceptable referrals if the landlord of the boat is separate from the landlord of the mooring – separate referrals are appropriate only where payments are made to different landlords. These may be referred as Pre-Tenancy Determinations, and they present particular valuation challenges to the Rent Officer.
For PTD referrals the RO should get full information regarding the type and size of vessel to be provided. This information should then be included in the remarks section of the determination, using wording similar to the following;
“This determination is for a 40’ canal barge ONLY occupying a mooring at the referred address”.
This approach avoids the problem of the landlord supplying older less well appointed vessels after receiving a RO pre-tenancy determination amounting to less than the referred rent.
Separate referrals for mooring and vessel rent also present a fundamental valuation problem concerning the comparison of like with like. When determining the ‘significantly high rent’ determination for a vessel care should be taken to ensure that the evidence used for comparative purposes is exclusive of any mooring fee element, or that adjustments are made to the evidence which is inclusive of a mooring fee element, to remove that element. If the referral is exclusive of the mooring fee then the evidence must be exclusive of the mooring fee.
This is not to say that the dwelling is to be valued without any consideration of its location – even if it has not yet been sited. The value of any dwelling has to take account of location. Location is often quoted as the prime driver of rental or capital value. The rental valuation of a houseboat exclusive of mooring fee will be exclusive of the normal charge for siting it on that mooring but it must still take account of the location. That is why you may find identical makes and models of vessel with different rents in different locations, despite all being exclusive of mooring fee. This may be because of differing amenities, views, local market conditions, or any number of other variables, which may not always be fully reflected in the differing mooring fees.
Lettings of ‘continuous cruisers’ must be referred based on a location address – after all Housing Benefit is paid on the basis of the dwelling being in the Local Authority area. Rent Officers should therefore annotate their determinations with a note of the base location used for the basis of the rental determination. An example of an appropriate annotation to be shown in the remarks section of the determination, is; “This determination is for the referred ‘continuous cruiser’ vessel exclusive of mooring charge based at Smith Quay”.
It should also be noted that the value of the two separate elements, boat rent and mooring fee, may not necessarily be equal to the value of a single letting including both elements. The key is to base the valuation determination on the closest possible comparable evidence available.
The ‘significantly high rent’ principles hold for the determinations of ‘size and rent’ and ‘exceptionally high rents’ which must consider ‘the dwelling’ and ‘the tenancy’, and the evidence must therefore be fully comparable, so if the referred rent is exclusive of mooring fee then the evidence used must be exclusive of mooring fee.
Local reference rent
However, the determination of Local Reference Rent is a determination which is for “an assured tenancy of a dwelling” which meets the size criteria, and so the evidence which is to be listed in rent order to determine the LRR will consist of all lettings with the appropriate number of rooms in the BRMA(LRR), and hence will be largely bricks and mortar lettings. It may include both rents for vessels which are inclusive of a mooring fee and rents which are exclusive of a mooring fee, and similarly caravans and mobile homes both inclusive and exclusive of site rents, but will mainly be flats and houses.
For clarity, this means that the LRR for referrals inclusive of mooring fees and exclusive of mooring fees will be the same LRR in the same BRMA(LRR) where the boat is the same length. However the determination of SHR, and the notional determinations for size and exceptionally high rent, may differ from those including mooring fees, as the evidence used for referred rents exclusive of mooring fees must be (or be adjusted to be) exclusive of the mooring fee element.
As far as lettings information is concerned, lettings of vessels are recorded on VIS, and there is a spreadsheet which contains all the LI for mooring fees only in a central (‘shared drive’) location for all Rent Officers to access.
It is clearly important when recording the LI on VIS to ensure that the information as to whether a vessel rent is exclusive or inclusive of the mooring fee element is included. Without this information it will not be possible to compare like with like accurately for the property specific determinations (significantly high rent, size notional and exceptionally high notional).
Some areas, despite the best efforts of Rent Officers to collect it, will have a dearth of evidence because there are few (or no) lettings of vessels in that area. If a case is then referred in that area, the allocated Rent Officer will have to rely on valuation techniques other than the direct comparable method normally relied upon.
Extrapolation and interpolation may be techniques employed. Looking at lettings information for similar lettings in a similar area but beyond the subject BRMA would be the preferred approach in these circumstances.
As regards comparison with evidence of bricks and mortar lettings, this would be a less reliable technique but may be employed as a check. Having carried out the comparison exercise as above, the figure which the RO is minded to value the subject vessel letting at may be checked by looking at the differential between it and an equivalent sized flat in the same area, and ensuring the differential is similar to that for a vessel and an equivalent flat in the similar area.
Bricks and mortar lettings information is rarely relevant to houseboat rents, although if we are aware, having regard to actual evidence, that houseboats are let at lower rents than, say, flats or terraced houses nearby we should look critically at any rents referred that are higher than the local bricks and mortar values.
- Mooring charges
- Significantly high rent determinations
- Size and rent determinations
- Exceptionally high rent determinations
- Local reference rent determinations
Elements of the rent which may not be included in the payment of housing benefit.
When Rent Officers receive a referral they must first determine the value of any ineligible charges (other than meals) and deduct this amount from the referred rent to produce the rent payable under the tenancy.
Ineligible charges are charges for services set out in the Housing Benefit Regulations as being ineligible for benefit, together with the tenant’s share of the water rates, if paid by the landlord. The identification of which services are eligible and which are ineligible for Housing Benefit is a matter exclusively for the Local Authority Housing Benefit department, and not a matter for determination by the Rent Officer. Special rules apply to charges for support services (see Support services handbook page).
The Rent Officer’s valuation of the ineligible charges is itself a determination which is notified to the local authority. The difference in rent for the same dwelling with or without services may not be the same as the value of those services, depending on the evidence of the lettings information for comparable tenancies with and without such services.
Rent Officers compile indicative standard deductions based on market evidence, and if the Local Authority has referred no details of any proof of costs provided to them by the landlord , these standard deductions may be used as the preferred starting point, for a consistent approach.
If the LA has provided proof of service costs from the landlord for a particular referral case –
- Use these as a starting point
- Value will only equate to cost when a landlord is giving best value and is providing the services in the most cost efficient way
- If a landlord gives solid evidence of service costs, Rent Officers would be unlikely to deduct more
- If a landlord shows a very high service cost or if a Rent Officer believes the landlord is not delivering the service in the most cost effective way, they might deduct less than the amount shown on the referral. This is because the cost would probably be more than the value of those services to most tenants of comparable tenancies
Rents can include council tax, which is an eligible charge. If a rent includes council tax Rent Officers should make no deduction from the amount referred, and valuations should reflect its inclusion as part of the rent.
Rent Officers make determinations using this reduced figure. All Rent Officer determinations are therefore net of all ineligible charges (except for meals). Where the landlord provides meals, the local authority decides the amount to deduct for meals from the Rent Officer’s determinations.
The table shows the most common eligible and ineligible service charges. If a Rent Officer believes that the Local Authority has wrongly identified a service as eligible or ineligible, the solution is for the Rent Officer to value the case as it has been referred, (without altering the referred details) and to invite a re-referral from the LA in the remarks section, pointing out the suspected error.
|Eligible Services, Included in RO net rent determination||Ineligible Services, Excluded from RO net rent determination (except meals**)|
|Provision of a heating system||Water charges|
|Fuel in communal areas||All other fuel charges|
|Laundry room or facilities||Laundry service|
|Leisure and sports facilities|
|Most satellite and cable TV and TV licences|
|Communal cleaning||Other cleaning, and other cleaning no one in the household can do|
|Communal window cleaning||Other window cleaning ***|
|Other exterior window cleaning no one in the household can do||Other interior window cleaning no one in the household can do|
|Other furniture and household equipment||Furniture and household equipment, if it will become property of tenant|
|Emergency alarm systems|
|Medical expenses *|
|Nursing or personal care*|
|General counselling or other support*|
|Any services not mentioned above, and not connected to the provision of adequate accommodation|
Special rules apply to charges for support services, which are indicated by *
Although meals are an ineligible service Rent Officers must still value them within the determinations and indicate to the local authority which meals are provided
Charges for exterior window cleaning and communal areas are not eligible for HB where they are funded by the supporting people scheme
- Support services
Local reference rent determination
The local median reasonable rent for lettings with the same number of rooms.
This is the fourth determination that Rent Officers have to make on a Housing Benefit referral. Unless the dwelling is in a hostel, they must determine a local reference rent in every referred case. The local reference rent is the midpoint between the highest and lowest rents for –
- Dwellings with the number of bedrooms and living rooms the claimant occupies; or
- If the claimant is over-accommodated, dwellings with the number of rooms allowed by the size criteria for the claimants household
- Across the same Broad Rental Market Area (Local Reference Rent) (BRMA (LRR))
To decide what is the highest and lowest rent, Rent Officers exclude any rents that are exceptionally high or exceptionally low. (See ‘Determining H and L’.)
One room categories
While the local reference rent is defined by the number of bedrooms and living rooms in the property, there are three possible local reference rent categories if the dwelling has only one room:
- One room let with substantial board and attendance
- One room with shared use of a kitchen, toilet, bathroom and living room
- Any other one room letting
- C includes studio flats (self contained one room accommodation) but also includes lettings with exclusive use of one room and shared use of, for example, more than one kitchen, toilet, bathroom or living room. It would also include one room lettings that do not have access to one of the named facilities, for instance a living room; or a one room letting with its own kitchen but shared use of a toilet, bathroom and living room. For this reason, when it comes to determining the “L” figure (see below) it is quite possible for the evidence to suggest, and for the Rent Officer to determine, a similar “L” to category B above
Local reference rent determinations
The local reference rent is determined by using the formula –
R = H + L ——– 2
- R is the local reference rent
- H is the highest rent in the BRMA(LRR) which is not exceptionally high
- L is the lowest rent in the BRMA(LRR) which is not exceptionally low
H and L do not include:
- Ineligible service charges (other than meals)
- Water charges
Rent Officers must deduct the value of ineligible charges from H and L at the start of the process, not from the local reference rent at the end.
The Rent Officers (Housing Benefit Functions) Order 1996 (as amended), (The Order), defines how “H” and “L” must be set:
- For an assured tenancy (including licences which are treated as assured tenancies for HB determination purposes)
- At rent levels which are not exceptionally high or low
- With reference to rent levels in the same BRMA (LRR)
- For a dwelling in a reasonable state of repair
- With the number of rooms the tenant is entitled to under the size criteria (or the number which the tenant has, if that is less)
- Excluding the influence of Housing Benefit on the tenancies used as comparable evidence, (which does not mean excluding all Housing Benefit evidence – see Housing Benefit Data), and
- Excluding any ineligible service charges
Determining “H and L”
The Order says that “H” is the highest and “L” the lowest rent, in the Rent Officer’s opinion, which a landlord might reasonably have been expected to obtain, at the relevant time, for an assured tenancy of a dwelling in the same BRMA(LRR), in a reasonable state of repair and with the same number of rooms and which is not an exceptionally high or low rent.
“H” for LRR purposes is unlikely to be the same as that used for the exceptionally high rent determination under the previous paragraph of the Order which was limited to the neighbourhood of the property. The LRR determinations relate to the BRMA(LRR).
“H & L” are not directly related to the number of pieces of lettings information available. There could be a number of market rents in a BRMA(LRR) which exceed “H”, or fall below “L”. “H” should not be the highest rent considered appropriate for Housing Benefit. It should directly relate to actual lettings information and local market intelligence. The starting point for determining where “H & L” fall is usually where there are fewer pieces of evidence on the database, at the ends of the range. However, it is the level of rent that must be exceptional, rather than the number of pieces of lettings information available. Rent Officers must use their market knowledge, backed by supporting information, to ensure that the range is complete before “H & L” are determined.
A Rent Officer’s professional judgement is informed by the lettings information available to him. In determining where to fix an “H or L”, a Rent Officer must have regard to the available lettings information at the relevant time on the Valuation Information System (VIS) database, which is of the appropriate age, i.e. reflecting the current lettings market. By confining the lettings information used to that on VIS we ensure that the lettings information has been quality checked and may be reproduced in future if necessary. This is why it is essential that Rent Officers enter their lettings information onto VIS promptly.
Lettings information can be looked at either as a list of rents or as a curve on a graph. The steepness of the curve will tend to show the point at which high rents become exceptionally high or low. The shape of the curve indicates the point at which rents start to rise or fall at a disproportionate rate. In other words, if there is a progression of rents that increase at about 1% from one to the next followed by a sudden jump of 5%, then at that point it could be said that those rents (no matter how many there might be) are exceptionally high.
Best practice is to consider the lettings information both as a graph and on a list when determining “H” and “L”.
It is usual for Rent Officers to have sufficient lettings information to be reflective of the range of lettings activity in the market, and to hold a piece of confirmed lettings information upon which to base the determination of “H” and “L”. In the rare circumstances where we do not hold sufficient information to determine an LRR, Rent Officers should use extrapolation or interpolation i.e. lettings information from similar BRMA(LRR)s. In no circumstances can judgement be reasonably exercised without confirmed lettings information.
Weekly ‘H’ and ‘L’ figures, rounded to the nearest penny, should be used to determine the LRR, even if the figures they are based on were originally monthly amounts. Whilst lettings information should be recorded to reflect the rental frequency under the tenancy, any subsequent conversion necessary to a weekly rent should be carried out in a consistent manner. A calendar monthly rent should be converted to a weekly rent by multiplying the calendar monthly rent by 12, and dividing the yearly rent by 52, as this formula is compliant with Regulation 80 of The Housing Benefit Regulations 2006. The resultant LRRs should not be rounded and these weekly LRRs will be the official published LRR.
Rent Officers will note that this monthly conversion method is different to that used for LHA purposes, which is defined within the Rent Officers Housing Benefit Functions Order..
LRR matrices and consistency issues
For consistency purposes. LRRs are agreed by Rent Officers across the various work streams.
It may be appropriate for a Rent Officer or redetermination officer to determine a specific local reference rent for a specific case which is different from the previously agreed figure. This could be for a remote property on the edge of a BRMA(LRR) or for a property with more than six rooms. It is essential to consult as widely as practicable in such cases. The Rent Officer should start by checking whether a similar LRR has been determined by another Rent Officer, by asking the Central Support Team who keep a central record. The Rent Officer should then consult their Team Manager. Finally any such LRR determination made by the Rent Officer must be notified to the Central Support Team.
Enquiries for details of all LRRs/SRRs
LRR information is available on the public internet site. If Rent Officers receive a request for LRR information not detailed on the internet or receive a request for information made under the Freedom of Information Act (FOIA), they should ask RO.Guidance for advice on the response, so that the volume and nature of such requests can be monitored. Please note that all requests for data should be directed to the Central Support Team to ensure such data sets are produced consistently.
Substantial changes to local reference rents
When there are substantial changes to LRRs it has been agreed with local authorities that we give them advance warning prior to implementation.
- Size criteria
- Single room rent
- Ineligible charges
- Housing Benefit data
- Sources of Information
- BRMA (LRR)
Dealing with applications where the charge is for renting the mooring where a houseboat may be placed.
The costs of renting and mooring houseboats are eligible for housing benefit; but as such costs are exempt from Local Housing Allowance they are subject to determination by the rent officer.
The local authority should refer the two amounts together where both the rent for the boat and the mooring charge are paid to the same landlord; however, if they are paid to different landlords two separate referrals are necessary. Where referrals are received for the dwelling alone, without the mooring charge, such cases are determined as any other bricks and mortar referral.
This handbook page concentrates on referrals for mooring charges without the rent for a dwelling, whether including or excluding licence fees or harbour dues, which is where the vessel is separately rented or the claimant owns their own boat.
Licence fees and harbour dues have been judged as eligible housing costs to be referred – they should be included with the mooring charge where they are paid to the same landlord, or separately referred if they are paid to a different landlord.
Rent officers must record Lettings Information (LI) on the designated spreadsheet because VIS is not suitable for recording these types of letting.
Mooring charges paid exclusively for holiday purposes must not be used as lettings information.
Most moorings are charged according to length of vessel and are therefore usually expressed in pounds per metre (£/m), and should be recorded as such on the Moorings Lettings Information spreadsheet in the shared drive. Some moorings are charged by the berth; these should be recorded as such on the spreadsheet so that when dealing with a valuation case, the rent officer can input the boat length to ensure the list of rents produced reflects the charge for the vessel in question at the various locations, to enable like for like comparison of charges.
On most inland waterways it is necessary to pay a (boat or craft) licence fee to the navigation authority, often the Canal and River Trust (formerly British Waterways), the Environment Agency or the Broads Authority. On coastal moorings similar charges, known as harbour dues, are payable to the harbour authority.
These separate fees and dues are also eligible for housing benefit and are therefore of importance when compiling and comparing Lettings Information and determining value.
The referred rent
Local Authorities ought to make clear what the referred rent includes - whether both the mooring charge and the houseboat rent, or both the mooring charge and the licence fee. If the referral is unclear, the rent officer should make further enquiries.
Generally though, the rent officer’s approach should be to take the referral at face value. If the referral makes no mention of licence fees, for example, the rent officer should assume they are excluded and should state the assumption in remarks – “As no reference has been made on the referral to a licence fee, it is assumed none is included” .
Such details must always be checked whenever an inspection is made. Where the referred details are different from those confirmed at inspection, the Rent Officer must value as referred and invite a substitute referral with corrected details using remarks. The only referred detail which may be changed by a Rent Officer is the property description where the Rent Officer has inspected.
Significantly high rent
In the case of moorings it may be that no comparable Lettings Information can be found in the vicinity; if so the rent officer should widen the search from the appropriate Broad Rental Market Area (Local Reference Rent), or extrapolating LI from similar BRMA(LRR)s.
When examining Lettings Information the rent officer should take account of the referred vessel’s attributes – such as a wide beam vessel which can only access certain types of mooring. The rent officer should also take account of the amenities provided and anything else included in the referred rent - licence fees and harbour dues for example. Lettings Information in respect of mooring charges is recorded by rent officers on a spreadsheet, which allows retrieval of that information by area, comparing charges for the referred boat length in various locations across that area, and comparison of charges per metre (vessel length), or charges per berth.
The SHR should always compare like with like in relation to the inclusion of licence fees.
Size and rent
If any element of the referred rent relates to a mooring charge then the case is exempt from a size and rent determination. A size and rent determination is only appropriate if the rent is for the vessel alone, or inclusive of licence fees only. In such an instance the comparable evidence to be considered would be for a similar dwelling in a similar location with the appropriate number of rooms.
See the separate handbook page on houseboats exclusive of mooring fees.
Local Reference Rent
Lettings Information for all types of moorings in the appropriate BRMA(LRR) is used for the determination of the LRR. The determination of LRR should include all moorings in the BRMA that can physically accommodate the vessel. This also applies to those referrals consisting solely of licence fees or harbour dues.
The list of charges may include moorings which are directly managed by the navigation authority (i.e. the mooring charge and licence fee/dues are paid to the same landlord) as well as evidence of mooring charges alone. Rent Officers should ensure that the list used when determining the ‘H’ & ‘L’ includes both inclusive and exclusive rental evidence where both exist in the local market. The LRR determination feature on the above mentioned spreadsheet automatically includes all appropriate charges.
If the Lettings Information is insufficient then information from a comparable BRMA(LRR) may be extrapolated. Judgement as to which BRMA(LRR)s to choose is made in relation to their market and geography (see the Extrapolation handbook page). When a sufficient list of charges has been selected, the rent officer makes a determination of ‘H’ and ‘L’ in the same way as in any other case taking account of the charges in £/m figures as well as the charge for the appropriate boat length. The spreadsheet used to record evidence and determinations of LRR for moorings displays the H and L and LRR in overall charge for the boat length.. A clear audit trail of the evidence used to determine the LRR should be recorded in the VICTER case notes/attachments using the spreadsheet extract facility.
It should be noted that where calendar monthly charges need to be converted to weekly charges, the formula to be used is: W = (M x 12)/52 which is compliant with Regulation 80 of The Housing Benefit Regulations 2006. This should be applied in reverse to convert weekly to monthly rent charges as necessary
The LRR is recorded on the spreadsheet as a central record.
Moorings cases typically use the same BRMA(LRR) as other cases.
Specifically comparable moorings, possibly extrapolated from outside the BRMA(LRR), should be considered when determining the SHR.
All moorings which can accommodate the subject vessel across the BRMA(LRR), and possibly extrapolated from outside the BRMA(LRR) must be used to determine the Local Reference Rent.
Where a separate licence fee or harbour dues referral is received it should be compared to the rate for other licence fees in the area for determination of the SHR, but for the LRR determination the appropriate mooring charge LRR should be applied.
- Houseboats excluding mooring charges
- Exemptions from Local Housing Allowances
- Broad rental market area
- Significantly high rent
- Size and rent
- Local Reference Rent
- Referred information – accepting at face value
The area for consideration of the exceptionally high rent determination.
‘Neighbourhood’ is the area used for the exceptionally high rent determination. It is also used as a component part of the locality for the local reference rent determination in cases with a relevant time dated prior to 5th January 2009: the locality must contain “two or more neighbourhoods, including the neighbourhood where the dwelling is situated”. The corresponding broad rental market areas (local reference rent) for cases with a relevant time dated on or after 5th January 2009 are not based on neighbourhoods.
Neighbourhood is defined in the Rent Officers (Housing Benefit Functions) Order in two ways:
- for urban properties, and
- for rural ones
‘Neighbourhood’ is defined for an urban dwelling as: “the part of the town or city that the property is in which is a distinct area of residential accommodation”. Where the property is not in a town or city the neighbourhood is: the “distinct area of residential accommodation” surrounding the dwelling which contains properties of the same size as the size criteria allows for the claimant and their household.
In both these definitions the neighbourhood is a ‘distinct area of residential accommodation’. It follows that a neighbourhood has two components:
- it must be based on a residential area (but it may extend beyond just the built-up area), and
- it must have an element of distinctiveness
There is no formal definition of neighbourhood beyond that in the Order. A neighbourhood could be:
- a small town or village
- part of a larger town or city
- a group of villages or hamlets
- a larger area of sparsely populated countryside
Rent Officers must note that a rural neighbourhood must contain properties of the appropriate number of rooms, ie the number in the subject property or the number that is in accordance with the size criteria as appropriate. As a result, rural neighbourhoods with a sparse population may cover a larger area than an urban neighbourhood.
The distinctiveness of a residential area may stem from a number of things and is a matter for the Rent Officer’s professional judgement. It could, for instance, be due to a sense of local identity or a predominant housing type. It could be due to a natural or geographic feature or boundary or it may be centred on some historic feature such as a market or church. It may be based on a local authority ward or a parish. Categorisation of distinctiveness will vary from one part of the country to another and within a particular part of the country. For instance, neighbourhoods in a city may be based on local authority wards, housing estates, or localised centres of shops and leisure facilities; in the rural area outside that city they might be based around groupings of hamlets and villages.
A neighbourhood should be identified using a locally recognised name or elements of one (‘St Anywheres’ or North Bigtown’). Alternatively it could be a conglomeration of established names (‘A, B and C villages’).
- BRMA for LRR and LHA
Applications made where the letting is yet to commence.
Any person considering renting accommodation and who is likely to claim housing benefit outside of the LHA rules (so the claim will lead to a referral by the LA) can apply to the local authority for a Pre Tenancy Determination (PTD), where they want to know how much rent the housing benefit department will consider in calculating their potential benefit entitlement.
This means we can deal with PTD referrals from HB departments for all LHA exempt case work, including board cases, mooring charges, houseboats, caravans and registered social landlord lettings.
The term Pre-Tenancy determination itself does not appear in the legislation, it simply mentions a prospective occupier. The VOA deals with applications for them in the same way as any other referral, except that they deal with them even more quickly than other cases.
The prospective occupier and landlord (or their agent) submit the application to the local authority who check that it has been completed and signed, before sending it to the VOA straight away. All relevant determinations (see Making Determinations) are made in the same way as “ordinary” ones, and a similar form is used to notify the local authority of the Rent Officer’s decision. The prospective occupier and landlord (or agent) are also notified of the Rent Officer’s decision at the same time.
The Rent Officer’s decision will normally set the maximum amount of rent that the local authority will use to work out that prospective occupiers Housing Benefit. However, it does not guarantee that the prospective occupier will get Housing Benefit or the amount that they will receive. The local authority will also take into account income and personal circumstances in coming to that decision.
The Rent Officers determination only becomes effective if and when the prospective occupier actually moves into the accommodation (and takes up the tenancy), submits a claim for Housing Benefit, and the local authority award benefit. Only at this point can a claimant appeal against their Housing Benefit award and/or ask for a redetermination of the Rent Officer’s decision.
The term prospective occupier can also mean tenants that already reside in a property. The HB regs state that:- ”prospective occupier” shall include a person currently in receipt of housing benefit in respect of a dwelling which he occupies as his home and who is contemplating entering into a new agreement to occupy that dwelling, but not in a case where his current agreement commenced less than 11 months before such a request”.
In other words, an existing claimant can also get a PTD if the landlord is thinking of putting the rent up, providing that the agreement started at least 11 months ago. The logic here is that the PTD system was designed to allow people to find out in advance whether Housing Benefit would pay their rent and, if there was a shortfall, how much that would be. It’s only reasonable to extend this to existing claimants whose rent is likely to go up. But, this 11 month condition is peculiar to existing HB claimants, it doesn’t apply to existing tenants that aren’t claiming HB.
Other PTD scenarios could be:
- PTD request for existing owner where property is expected to be sold – in this case we can deal with the case as there is a new tenancy agreement being presented to be signed
- PTD for dwelling not currently “built” – this covers scenarios such as a PTD for a new caravan where the van has not been placed on site, and for dwellings that are being refurbished – in these cases the RO must make a decision as to whether or not it is possible to value. In the example of a caravan it may be that information can be obtained regarding the model and therefore this can be valued. In the example of refurbishment works the RO must satisfy themselves that the work will be completed and make a decision on the standard of the work. If it is not possible to ascertain the standard then the RO can decide NOT to entertain the PTD
Reason for decisions
Rent Officers explaining their determinations to the Local Authority or claimant.
As part of the Agency’s policy of openness and transparency, and in the spirit of the Human Rights Act, Rent Officers automatically provide some explanation of their Housing Benefit determinations. The “standard reasons” are a series of standard paragraphs, the appropriate paragraphs for each case are automatically selected and displayed at the end of each determination notice.
Additional redetermination officers requirements
Redetermination officers are required to provide more detailed reasons for their decision which must provide a sufficient explanation for the decision reached and setting out the considerations taken into account. This will involve a reference to any specific points made in any letter of representation, application for redetermination or anything put to them during an inspection. The reasons must explain each of the redeterminations made and explain fully:
- the volume and range of lettings information used; and
- the extent of the locality used
Some customers will expect further information and more detailed reasons for their determinations. Landlords and their agents may also put pressure on VOA staff to give reasons for determinations about their tenants’ housing benefit claim, including details of how determinations were made, how and what lettings information was used, and details of the extent of localities and the “H” and “L” points for Local Reference Rents and Single Room Rents.
Valuation teams also occasionally receive letters from Housing Benefit claimants, landlords, solicitors or others on behalf of claimants threatening legal action following determinations but before a redetermination has been requested. The Courts usually expect claimants to exhaust their alternative remedies including all opportunities for redeterminations before allowing a legal challenge (Judicial Review) to a determination. However the Courts have also said that we must give clear and full explanations of our decisions and tell claimants about their rights to request a redetermination and to make representations via the local authority.
All incoming correspondence must, without exception, be dealt with in accordance with the VOA Correspondence and Complaints procedure. Most requests for explanations and reasons for determinations would be classed as category “B” correspondence, and the appropriate booking in procedures must be used under the Correspondence and Complaints Procedure, which can be found in the operations section of the intranet, must be used. Additionally any response must use the appropriate reply template found under the Correspondence and Complaints procedure, which has an additional footer advising the enquirer about our formal complaints procedure.
VOA must always be open and accountable. Staff must provide a full and complete answer to a request for information when it is first made. But to comply with the Data Protection Act (DPA), VOA can only provide detailed information about individual determinations to those people who are entitled to receive it:
- Detailed information about a specific case can only be given to the individual claimant concerned, or their representative. Staff must make sure that representative has genuine authority to obtain information. This is usually by written consent, though we would not usually ask for written proof where the representative is a solicitor
- Staff must not give detailed information about housing benefit determinations to landlords or their agents unless they can prove that their tenants wish VOA to do so. A letter signed by the tenant giving VOA permission to discuss their case with their landlord / agent would be acceptable
- Some landlords / agents make requests for details of their tenant’s Housing benefit Claim citing the Freedom of Information Act (FOI). This act relates to public bodies being accountable to the public and open about their procedures and information. It does not extend to discussing a claimant’s personal details or Housing benefit claim with anyone else, protected under the DPA, and not releasable under FOI
Responses to all requests must follow the standard agency templates found under the Correspondence & Complaints Handling procedure on the intranet. The content of any reply must be tailored to the specific case in question, should be comprehensive but written in Plain English, and close with the standard correspondence and complaints handling footer text. A number of “reasons templates” are provided on the intranet with some appropriate text to use. Details of these templates can be found later on this page.
Staff should aim to reply fully within 3 working days, and can provide the following information:
- Staff should be prepared to explain the process of collecting, analysing and using lettings information
- Staff should be prepared to demonstrate the extent of VOA lettings information, showing the range of rents achieved by postcode in graphical format
- Staff should explain clearly if a reduction in rent is because the premises are in a poor state of repair
The following information should not be provided:
- Staff must not give details of determinations to anyone other than the tenant (or their properly authorised representative) and the local authority in Housing benefit cases
- Staff must not give full details of actual addresses in the lettings information database, or VOA will be in breach of the DPA and may be breaking commercial confidences as well
In any case where judicial review is threatened staff must not reply without following the appropriate Agency procedures, and in the first instance contacting the Legal and Guidance Unit Helpdesk
All Housing Benefit claimants are entitled to know how their Local Reference Rents and Single Room Rents are assessed. But there are risks in releasing current LRR/SRR data on a wider basis because the information:
- changes regularly, and there may be many LRRs/SRRs in an area
- is part of an administrative process, not a property-specific valuation
- relates to number of rooms rather than a specific property type
- may be politically sensitive and may be quoted or used inaccurately
- may be used to lead the rented market and drive rents up
Staff must be prepared to give to an individual claimant full details of how we assessed their own LRR/SRR. Staff need to take reasonable care to ensure that they are talking to the actual claimant if they are answering a telephone enquiry, or that anyone claiming to be acting on the claimant’s behalf has permission to do so.
Local Authority HB sections
Managers and staff must be prepared to discuss their own area’s LRRs/SRRs with their own LAs, but they should not provide a complete list of assessments. They should be willing to explain localities, and the H and L levels, and the range of evidence used. Normally this would be part of a regular SLA meeting as VOA seek to encourage good relationships with our customers.
Any other enquirer
Staff must be prepared to discuss LRRs/SRRs in general terms with any enquirer, explaining the requirements of the Order, and the way they obtain necessary evidence, using simple non-technical language. As a public body VOA have a duty to provide general information about the service the Agency provides and FOI may be cited to access LRR / SRR information.
Enquiries for details of all LRRs/SRRs
Staff must not give full details of all their current LRR/SRRs to anyone, including other government departments and agencies, educational or research establishments and private sector companies. Any enquiry for full details of LRRs/SRRs quoting the Freedom of Information Act (FOI) must be referred In the first instance, to the Legal & Guidance Unit helpdesk : RO.Guidance@voa.gsi.gov.uk.
If staff receive general requests for LRR / SRR data, enquirers should be directed to the VOA valuation report and historic LRR information which is available on the publications section of the VOA public website.
Once correspondence has been logged in accordance with the Correspondence & Complaints procedures, Valuation Team Managers will need to draft a suitable response using the standard letter templates found under that procedure. The Legal & Guidance team have drafted some standard form of words that may be used for the main body of text in any reply. There are three standard template letters in the Operational forms page of the Rent Officer Handbook on the Intranet along with instructions for use in cases where a claimant or someone acting on their behalf makes enquiries following a determination. These templates produce a standard general response with basic information about how a determination was made. These can be sent out by a Valuation Team Manager without approval from the Legal & Guidance Unit (LGD). However, LGD should be consulted first in cases where there is a serious threat of judicial review (JR) or other legal challenge. The resultant letters can be customised to add information if necessary and they can be adapted for responses to other types of enquiry. However they should not be used for responses to questions about redeterminations without approval from LGD first.
The three templates are:
- ‘Third party’s request template’ - for use when we have received a request from a landlord or third party but we don’t know whether they have the claimant’s authorisation to act on their behalf
- ‘Representatives standard reasons template’ - for use when replying to a representative of the claimant, for instance a solicitor, welfare rights or advice centre worker or a landlord who is acting for the claimant
- ‘Claimants standard reasons template’ – similar to the above, for use when replying to the claimant in person
The ‘Third party’s request template’ is a simple letter asking for authorisation to act on behalf of the claimant; the user just has to personalise the letter. There is no need to see an ‘authorisation to act’ from a solicitor (or firm of solicitors). Frequently solicitors will include an ‘authorisation to act’ statement with their initial letter but if one is not provided there is no need to seek one.
The other two templates (‘Representatives standard reasons template’ and ‘Claimants standard reasons template’), as well as having sections to personalise the letter, also have a series of AutoText prompts which insert a suitable paragraph explaining a particular decision at the relevant point in the letter.
The instructions give guidance on how to use these letters. Staff can download these templates in the same way as other documents in the Forms Cabinet.
Explanations we can give to landlords after pre-tenancy determinations
Staff should be aware that we cannot normally discuss the details of a Housing Benefit determination with a third party without the express authorisation of the claimant. A Housing Benefit claim is confidential and this principle extends to the referral from the local authority to the Rent Officer and the determinations that follow. Normally we can only explain the general principles of our Housing Benefit determinations to a third party who is not acting directly on behalf of a claimant and in those circumstances we cannot discuss an individual case. However because the landlord has signed the PTD application form confirming that they are considering granting a tenancy of the dwelling and has given consent to an inspection staff should extend the principle of explanation on request to PTD landlords. Any appointment for an inspection that is required is likely to have to have to be arranged via the landlord or agent so they are also involved in the practical aspects of the process as well and a copy of the PTD notification is also sent to them directly. Once landlords receive this notification they may contact the rent office for an explanation, especially if the claim-related rent or local reference rent is lower than the proposed rent.
Staff should be prepared to explain to PTD landlords the following:
- how the significantly high rent determination was made and the use of comparable market evidence
- if there was a size and rent determination: how the size criteria operates and how this was applied to the claimant’s household
- if there was an exceptionally high rent determination: how this was determined
- which of these determinations formed the claim-related rent and whether this related to the property as it stands or an appropriately sized notional one
if the local reference rent was lower than the claim-related rent: what the local reference rent represents and how it is calculated including:
- whether it was calculated on the property as it stands or on an appropriately sized property
- what the locality was
- if it was a single room letting which LRR category was used
- if a single room rent was determined: what this represents and how it was calculated
The `Representatives standard reasons template’ can be used to reply to a landlord seeking information after a PTD and this can be amended to suite individual circumstances or to answer specific information requests.
What we should not discuss with a PTD landlord
We should restrict our comments and discussion to those matters which directly affect the PTD. Any other details which you may have found out, for instance in conversation with the prospective tenant, but which do not form part of the PTD application or do not directly bear on the determination should be treated as confidential and not discussed with the landlord or any other third party. You can discuss the PTD and how it was made but nothing further.
There may be occasions where the landlord has not acquainted themselves with the details of the prospective tenants or has signed a blank PTD application form and are unaware of the exact relationship between prospective tenants. If a landlord contacts VOA seeking an explanation of the determination staff must be conscious of the need to briefly explain the determination professionally and factually but to avoid any disclosures or discussion about the potential claimant’s personal life. This applies particularly to cases involving same-sex couples. Staff must be discrete and decline to discuss or comment on anything other than the facts that were noted on the application form and taken into account in the determination.
You should never discuss the possibility of how much Housing Benefit a potential claimant may get. Although the PTD will give an indication of the limit that they may get there are many reasons why the claimant may get less or no benefit at all. Questions about Housing Benefit can only be answered by the local authority.
Although the landlord is part of the PTD application he / she will not be part of any Housing Benefit claim that follows if the potential tenant takes the tenancy. Whilst we can discuss how the PTD was determined we must make it clear to the landlord that we will not discuss anything further without authorisation to act from the claimant.
- Lettings information
Rental purchase agreements
Applications where the rent claimed relates to a rental purchase agreement.
Where a referral or request for a redetermination relates to a rental purchase agreement, the agreement is to be treated as if it were a tenancy.
We deal with referrals and redetermination requests where there is a rental purchase agreement in the same way as any other:
- making all of the required determinations
- using the assumptions; and
- notifying the local authority of the determinations
- Glossary - HB
- Determinations – notifying the LA
Significantly high rent
The determination of a reasonable market rent for the referred letting.
This is the first determination that Rent Officers have to make. When the application is received the Rent Officer deducts the value of any ineligible charges (other than meals) from the referred rent to produce the rent payable under the tenancy. The Rent Officer must determine whether this reduced figure is significantly higher than is usual. If it is, they must determine the highest rent that is not significantly high.
The significantly high flowchart shows how to make this determination.
There are some key points to take into account in making the significantly high rent determination
- This determination is specific to the property
- Compare the rent with those of similar properties, in the same vicinity and let on similar terms
- The location from where evidence is to be considered will be the vicinity, being the area immediately surrounding the dwelling. If the property is in a town or city, this could mean just the street the property is in or a few adjoining streets. If the property is in the country, the vicinity could be a small hamlet or village
- As with all valuations, the determination should be supported by rather than based upon the available lettings information. Rent Officers should look at all the local factors and amenities which influence local rent levels. They should also be aware of comparable evidence in the surrounding neighbourhood and locality
- In some areas, or for some property types, there may be a shortage of comparable evidence. Where this is the case, Rent Officers should extend their search for evidence more widely into other nearby vicinities or property types and sizes and extrapolate from that evidence. This does not extend the immediate vicinity of the dwelling
- The rent should be above a reasonable market level and the difference significant rather than necessarily a substantial amount
Rent Officers should value in accordance with the referral except:
- Where they have conclusive evidence that the premises or details of the contractual arrangements are different from the description on the referral
- Where they inspect a property and find conclusively that the premises or contractual arrangements are different from the description on the referral
- Where they inspect and find that the household size or composition appears to be different from the information on the referral and the local authority agrees in writing (for example, by fax or email)
Rent Officers must tell the local authority, in the ‘remarks box’ on the decision document, about any difference between the basis of determination and the information on the referral.
- Significantly high determination flowchart
- Valuation - practice
- BRMA (LRR)
Single room rent
The local median reasonable rent for lettings of a single room.
This is the fifth determination that Rent Officers have to make. Unlike the first four, which are considered in every case, Rent Officers only make the single room rent (SRR) determination if the local authority indicates on the referral form that they require it.
The single room rent is the maximum rent used to calculate housing benefit for single claimants who are under 35.
The trigger age was 25 until January 1st 2012 when it was raised to 35. This means that for claimants aged under 35 the referral made after 1st January 2012 at the annual review of the claim, or at the start of any new claim, should include a request for a SRR. (A parallel change is being made for single claimants under 35 who claim Local Housing Allowance [LHA]; their claims will be restricted to the ‘shared accommodation rate’ when any new claim is made, or when their existing claim is reviewed from 1st January 2012.)
In order to determine a SRR, Rent Officers must determine the midway point between the highest and lowest rents for a single room:
- with the use of a shared living room
- with shared use of toilet and bathroom
- with shared use of kitchen, and no exclusive use of facilities for cooking food
- in the same locality; it should be noted that after 5th January 2009, the term locality in this part of the Order as amended, can be taken to equate to Broad Rental Market Area (Local Reference Rent) – referred to as BRMA (LRR)
Evidence used to determine the SRR must match the definition above exactly. Where there is either NO shared living room, or more than one shared living room, for example, it will not match the definition and should be excluded.
The single room rent is determined by using the formula:
S = (H+L) / 2
- S is the single room rent
- H is the highest rent in the BRMA (LRR) which is not exceptionally high
- L is the lowest rent in the BRMA (LRR) which is not exceptionally low
H and L do not include:
- ineligible service charges (other than meals)
- water charges
Rent Officers must deduct the value of ineligible charges from H and L at the start of the process, not from the single room rent at the end.
There are some key points that Rent Officers take into account in making the single room rent determination –
- Compare the rent with those of assured tenancies (which may include some licences) of properties in the same BRMA (LRR) satisfying the criteria
- The location from which evidence should be drawn was the locality for cases with a relevant date prior to 5th January 2009, and is the BRMA (LRR) for all other cases
- Assume that no one entitled to housing benefit wanted the premises
- As with all valuations, the determination should be supported by lettings information
- ‘H’ for SRR purposes is unlikely to be the same as that used in making exceptionally high rent determinations because Rent Officers will be looking at the BRMA (LRR) in making the single room rent determinations
- ‘H’ and ‘L’ are not related to the number of pieces of evidence. Rent Officers must decide when the amount of rent is exceptionally high or exceptionally low
- The dictionary defines ‘exceptional’ as “forming an exception, unusual or outstanding”. It is the rent which has to be exceptional not the rate of occurrence of that level of rent. There may be quite large numbers of exceptionally high rents in the best part of a neighbourhood
- Exceptionally low is the opposite of the exceptionally high concept and is easy to identify from comparable market evidence in a BRMA (LRR). The ‘L’ does not relate to landlords’ commercial aspirations of maximising rental income. It is possible that a philanthropic landlord may let premises at less than their market value. ‘L’ may fall just above the point where the rent is not financially viable
- Properties where the rent falls below ‘L’ may be in poor condition. Rent Officers must ensure that rents of unfit property do not bring ‘L’ too low. The exceptionally low determination must represent the rent paid for a property in a reasonable state of repair
- SRR does not apply to tenants of hostels, some residential homes, and registered housing association property. Some claimants who were the subject of care orders under the 1989 Children Act are also exempt
Single room rent determinations, like those of local reference rent, should be in weekly figures. This is to ensure consistency with LHA determinations. To ensure consistency SRRs should also be calculated using weekly rents for the ‘H’ and ‘L’ points. Weekly ‘H’ and ‘L’ figures, rounded to the nearest penny, should be used to determine the SRR, even if the figures they are based on were originally monthly amounts.
For instance, if a specific item of confirmed lettings information is identified as the point for an ‘H’ or ‘L’ at a figure of £320.00 per calendar month, this should be determined as £73.85 per week. Likewise £750.00 per month would become £173.08 per week. If, however, the exceptional circumstance arises where a determination of ‘H’ or ‘L’ is to be extrapolated from lettings information without a specific item of confirmed data upon which to base it, the Rent Officer determination should be made as a round figure using whole pounds per week.
The resultant SRRs should not be further rounded, and these weekly SRRs will be the official published SRR for the category and BRMA (LRR). Any monthly equivalent should it be required, will be calculated using the following method; (weekly figure x 52) / 12.
Enquiries for details of all LRRs/SRRs
Staff must not give details of the full range of their LRR/SRRs to anyone, including landlords, other government departments and agencies, educational or research establishments and private sector companies. Retrospective LRR information is available in the Publications section of the VOA Corporate website (under Residential - Reports); please direct enquirers to these tables in the first instance. If VOA staff receive a request for LRR information not detailed in these tables or receive a request for information made under the Freedom of Information Act (FOI), they should ask Rent Officer Guidance for advice on the response, so that the volume and nature of such requests can be monitored.
- BRMA (LRR)
- Freedom of information
- Reasons for decisions
- Determinations – local reference rent
Size and rent
This is the second determination that Rent Officers have to make. It is made under the size criteria, and the Rent Officers (Housing Benefit Functions) Order (the Order) calls it the “size and rent” determination, though it is sometimes known as the ‘size notional determination’.
Rent Officers must determine whether claimants have more rooms than the Order provides for. If the dwelling has too many rooms, Rent Officers must determine what would be the appropriate rent for a similar property, in reasonable condition, with the right number of rooms under the size criteria. This is referred to as the notional rent.
The Order sets out the size criteria: the number and type of rooms allowed depending on the number of occupiers and the composition of the household. Rent Officers compare the right number of rooms permitted by the size criteria with the actual number of rooms in the referred dwelling.
The Rent Officer has no power to make allowances for personal circumstances. The criteria allow an additional bedroom where the claimant or their partner is entitled to an overnight carer, and where the claimant or their partner is a foster parent. Also where the LA identifies that there is a child who cannot share a bedroom, (according to the definition in Housing Benefit Regulation 2(1) which includes medical needs), an additional bedroom is allowed under the Order. The Order only allows the Rent Officer to consider the occupants as stated by the local authority on the referral. The LA decides who is or is not an occupier, where a carer is required, and the LA alone decides where a child with medical needs should be defined as a child who cannot share a bedroom.
If the dwelling has more than the allowed number of rooms, the Rent Officer has to decide whether the Significantly High Rent Determination is more than a landlord might reasonably be expected to obtain for a tenancy of a dwelling with the correct number of rooms – and on the basis that no one entitled to housing benefit wanted the tenancy.
Size and rent determination
The determination of a reasonable market rent for a letting with the appropriate number of rooms under the size criteria.
There are some key points to take into account in making the size and rent determination –
The hypothetical property must have the right number of rooms but otherwise it must be the same as the subject property or, at least, correspond to it as closely as is possible (see ‘Assumptions’ below).
The location from which evidence should be drawn will normally be the same as used for the Significantly High Rent Determination. This is the vicinity - the area immediately surrounding the dwelling. If the property is in a town or city, this could mean just the street the property is in, or a few adjoining streets. If the property is in the country, the vicinity could be a small hamlet or village. Where there is no evidence in the area immediately surrounding the dwelling of similar dwellings of the right size, the Rent Officer must use the vicinity nearest to the dwelling where there is such evidence – or widen the search parameters until suitably supportive lettings information can be found.
As with all valuations, the determination should be supported by rather than based upon the lettings information. Rent Officers should look at all the local factors and amenities which influence local rent levels. They should also be aware of comparable evidence in the surrounding neighbourhood and BRMA(LRR).
A notional rent assumes that the property is in a reasonable state of repair. Therefore, if a property is in poor repair the notional rent may be higher than the referred rent or the Significantly High Rent.
In that event the notional figure is not notified to the LA.
So when the size criteria are exceeded, the relevant box on VICTER is checked. If the Rent Officer’s determination is higher than the referred rent, the figure input should not exceed the referred rent. This prevents the higher figure from appearing on the determination notice.
Where the size notional is lower than the referred rent, the Rent Officer’s figure should be input.
Overnight Carers and Foster carers
The Rent Officers (Housing Benefit Functions) Order was amended from 1st April 2013 and requires Rent Officers to allow an additional bedroom under the size criteria where:
- The tenant or their partner (or both) requires overnight care
- the tenant or their partner (or both) is a qualifying parent or carer
Two additional bedrooms are allowed under the size criteria if:
- the tenant or their partner (or both) require overnight care and the tenant or their partner (or both) is a qualifying parent or carer.
No additional living rooms are allowed as a result of any of the additional bedrooms above.
A qualifying parent or carer has the same meaning as within the Housing Benefit Regulations (Reg 2(1)) and this judgement is for the Local Authority to make. It relates to the tenant or their partner being a registered foster parent.
Children with medical needs requiring separate bedrooms
Following the “Burnip” judgement, it may be appropriate for some children with medical needs to be allowed separate bedrooms.
The Order was amended with effect from 4th December 2013 so that if the LA judges that a housing benefit claim should attract an additional bedroom for this reason, they may seek a Rent Officer determination which allows for a child who cannot share a bedroom under the size criteria.
The LA should clearly identify such referrals, and the Rent Officer must accept them. The decision as to whether a child is defined as a child who cannot share a bedroom (under Housing Benefit Regulation 2(1)) is a decision for the LA to make.
Caravans / site rents / houseboats / mooring fees
If the referred rent is for a caravan including a site rent, or for a site rent alone, or for a houseboat including a mooring fee, or for a mooring fee alone, then the size notional determination must not be made.
- Lettings information
- Size criteria
- Valuation – practice
- Caravan site fees
- Non resident carers under the size criteria
The size criteria rules set out the number and type of rooms allowed, according to the number and make up of occupiers in the dwelling. The rent officer has no discretion to vary these rules in any way, whatever the circumstances of the case. The Rent Officer’s determination of size and rent under Schedule 1 Paragraph 2 of the Rent Officers (Housing Benefit Functions) Order 1997 as amended is made for a dwelling which is equivalent to the referred dwelling, but has the following number of rooms:
One bedroom or room suitable for living in is allowed for each of the following categories. (Each person is counted only once, and in the first category that they fall into):
- (za) a member of a couple who cannot share a bedroom;
- (zb) a member of a couple who can share a bedroom;
- (a) a couple;
- (b) a person who is not a child;
- (ba) a child who cannot share a bedroom;
- (c) two children of the same sex;
- (d) two children who are less than ten years old;
- (e) a child
From 1 April 2013 the size criteria was extended to include an additional bedroom where the claimant or their partner had a proven need for overnight care and / or the claimant or their partner is a “qualifying parent”. If the claimant or their partner is both a qualifying parent and requires overnight care, then 2 additional bedrooms may be included.
From 4 December 2013 an additional bedroom may be allowed where the LA identifies a child as being one who cannot share a bedroom.
From 1 April 2017 the size criteria was further extended to include an additional bedroom where a disabled child or disabled non-dependant adult has a proven need for overnight care, and / or a disabled couple are unable to share a bedroom.
In all cases the additional bedroom(s) must exist within the dwelling and it is the local authority’s responsibility to decide whether a person should be included in the household. If so, the LA must identify
- the household member who is unable to share a bedroom and / or
- carer and / or
- qualifying parent
on the referral and the rent officer should allow an additional bedroom for that household member / carer / qualifying parent.
The Rent Officer then allows the following extra rooms suitable for living in, depending on the total number of occupiers in the household, but excluding any non-resident carer:
- One room where there are 1 to 3 occupiers
- Two rooms where there are 4 to 6 occupiers
- Three rooms where there are 7 or more occupiers.
When deciding how many extra rooms are allowed the age or sex of the occupier does not matter. The entitlement to an additional bedroom for a carer / qualifying parent does not affect rooms suitable for living in, so there is no entitlement to an additional living room to account for a non-resident carer.
The term bedroom or room suitable for living in can be interchanged once the total number of rooms allowed under the size criteria has been calculated, as above.
In operating the size criteria rent officers should consider only the occupiers noted on the referral and no one else. Children who visit at weekends may not qualify under these criteria, but this is a decision for the local authority to make and not the rent officer. If rent officers are told other people occupy the property, they should check with the local authority, but must value according to the number of occupiers noted on the referral referred unless the local authority agrees any change in writing.
A local authority is responsible for deciding who is or isn’t an occupier. The size criteria only take into consideration the number of occupiers; it does not generally look at the personal needs of any of the occupiers.
Local Authorities will identify a claimant or a claimant’s partner as a “Qualifying Parent” where he / she has a child placed with them:
(i) by the LA or voluntary organisation under the Children Act 1989; (ii) prior to adoption; (iii) as a result of an adoption; or (iv) in exercise of their functions as approved foster parent.
A child may be defined as a child who cannot share a bedroom by the LA under Housing Benefit Regulation 2(1) which takes medical conditions and receipt of certain other benefits into consideration. The decision rests solely with the LA, and not the rent officer.
A “change in the composition of the household” occurs when the household composition falls into different categories of the size criteria than previously.
The size and rent determination is not applied if a referral includes mooring charges for houseboats or site fees for mobile homes.
- Change of Circumstances
- Determinations – size and rent
- Valuation practice
- Non-resident carers under the size criteria
Where the rent includes an amount for personal support .
Special rules apply to rents that include charges for support services. The local authority identifies on the referral that the tenancy includes support services, and refers the rent net of all such charges. The local authority also tells The VOA:
- that the gross rent includes charges for support services
- the amount that has been deducted for support services from the gross rent payable
(This is explained more fully in the handbook page on supported accommodation.)
Valuation teams then deal with these referrals like any other. When they receive the referral, the Rent Officer must first calculate the value of any Ineligible Services (other than meals) and deduct this amount from the referred rent to produce the ‘rent payable under the tenancy’. They apply the various tests to this reduced figure in making determinations.
Rent Officers do not value support services. They make their determinations net of all support services, and all other ineligible charges (other than meals) including water and sewerage charges.
Additionally, if the accommodation is in a hostel, they do not make exceptionally high, local reference rent or single room rent determinations.
|Eligible Support Services||Ineligible Support Services|
|Cleaning of dwelling which neither claimant or member of household can do, except where funded by supporting people. Interior window cleaning of dwelling which neither claimant or member of household can do, except where funded by supporting people||Other cleaning of dwelling, Other window cleaning of dwelling, Emergency alarm systems, Medical expenses, Nursing or personal care, General Counselling and other support|
- Supported accommodation
Where the letting includes an amount for personal support in the rent.
“Supported accommodation” is not defined in statute, but it can be summarised as any accommodation where the occupier receives some sort of help to enable them to live in the accommodation safely. Actual support must be provided, so the landlord’s higher management costs alone are insufficient to make the accommodation ‘supported’. Where supported accommodation is provided by a private landlord, it is exempt from the LHA.
Supported accommodation offers services to tenants with special needs that are not normally provided in the mainstream rented sector. A wide range of accommodation with associated support is generally included in the term ‘supported accommodation’. It includes sheltered accommodation provided principally for elderly people, hostel and other shared accommodation for people needing 24-hour staffed accommodation, and accommodation where people need only occasional social support and assistance. The most common types of supported accommodation are:
- Private accommodation with resident or non-resident carer
- Purpose built accommodation with full or part time staff provided by charities or voluntary groups
- Hostel accommodation
The accommodation is generally accommodation provided by a county council, housing association, registered charity or voluntary organisation where that body or person acting on their behalf provides the claimant with care, support or supervision. It is for the Local Authority to decide whether a referral is to be designated as “supported accommodation” but if the Rent Officer becomes aware of the referral being incorrectly designated as such, the referral may be returned to the LA as outside the referral system. In this event the claim may fall to be treated as an LHA case.
A wide variety of people with special needs are catered for in such accommodation, in particular people with mental health difficulties or learning difficulties and people who are vulnerable as a result of their age or circumstances. Support may include help with debt counselling, life skills training, form completion, advice on paying bills, etc.
Since the introduction of the current rules in April 2003, the local authority must first determine and deduct that part of the rent attributable to “support” costs before issuing a referral to the Rent Officer. The support element generally refers to:
- Medical expenses
- Nursing or personal care
- General counselling or other support
Rent Officers never determine a value for support charges, so where a referral is received, and the Rent Officer believes that the referred rent includes any amount attributable to support charges, then it should be returned to the local authority requesting that the case be re-referred with the support element removed.
Once the referral has been received net of support, the Rent Officer must then determine the value of any ineligible charges (other than meals) and deduct this amount from the referred rent to produce the rent payable under the tenancy.
Supported accommodation is not generally provided through the mainstream private rented sector. Some is provided by Housing Associations, Charities or other bodies related to helping vulnerable or elderly people, or those with special needs.
Net v Gross rents
Where a tenancy is identified as including support, the rent must be referred net of support services. The net rent must always be lower than the gross rent, i.e. the support element must always be attributed a value by the local authority. In exceptional and rare circumstances the LA may send in a referral where they are saying that the support element is not charged to the tenant and so the net rent is the same as the gross rent. This can be accepted where the support is provided by a third party. Where the support is provided by the landlord, the net rent should always be lower than the gross rent - however where the LA indicate that the amount attributable to support is so small as to be unquantifiable, or indeed that the landlord provides support at nil cost, the RO should treat the referred rent as being the NET rent. It is a matter for the LA themselves to be satisfied having made the necessary enquiries that it is supported accommodation, and the Rent Officer should accept the LA’s designation. Where there is any doubt, please refer to the guidance team.
There is an inspection checklist available from the forms and letters page of the intranet which acts as an aide memoire to help Rent Officers to ensure that at the inspection of the property, they collect the information necessary to arrive at an informed determination.
The valuation method is the same as for any other Housing Benefit case. Rent Officers must use market lettings information. This will provide the “dwelling” element of the rent charge; as the referred rent must exclude all elements relating to support costs.
Landlords of “Supported Accommodation” typically charge a higher rent than would be achievable for equivalent “non-supported” accommodation. Providers of supported accommodation attribute this to the greater level of property and client management and general wear and tear on the fabric and facilities of the dwelling associated with the specialist letting. Rent Officers recognise the specialist nature of these lettings and where possible reflect any potential additional costs associated in providing the accommodation in their rental valuation. It is important that Rent Officers consider each referral individually and decide if there is any merit in attributing higher value to the rent due to additional costs associated with providing supported accommodation which are not ordinarily found with lettings of similar accommodation in the open market. The appropriate adjustment made to the ordinary open market rent, if any, would depend on the specific circumstances and nature of the letting. Rents may be referred at an unexpectedly high level, perhaps because the support element deduction has been inappropriately assessed. Only the “dwelling element” is intended to be supported by Housing Benefit. Support costs are separately funded by the “Supporting People” scheme or some other source.
Some landlords of supported accommodation base their rents on the cost of adapting the dwelling to the needs of the tenant, and on providing a resident manager. Additionally they typically assess depreciation over a very short time (such as 8 - 10 years) which enhances rental calculations. They may also add an amount for interest payments and profit. Rent Officers must, however, always determine the rent on the basis of value rather than cost. Care should be taken when considering any supporting analysis of the rent submitted with the application, as different providers will interpret net rent differently. The term ‘core rent’ which is frequently used does not always equate to net rent. ‘Net rent’ is the rent for the accommodation excluding all the services and this is not to be confused with the basic referral requirement for the rent net only of support. (N.B. The rent for the accommodation excluding all ineligible services upon which Housing Benefit may be based is called ‘the rent payable under the tenancy’ under the Housing Benefit legislation.)
Rent Officers should focus on value for money and value to the tenant - and must therefore use comparable lettings information acquired from the open market to determine a “Significantly High Rent”. It is not appropriate to use other kinds of lettings information – ie where the rent is based on cost of provision rather than value.
Where directly comparable evidence is not available, Rent Officers must extrapolate. They must use their experience to make suitable adjustments - without losing sight of the need to concentrate on value only.
Assessing the appropriate adjustment to reflect the nature of the client group
A judgement concerning the nature of the client group enables Rent Officers to make adjustments that adequately reflect the landlord’s increased liabilities.
If the client group has only a basic level of support, for example the clients are able to look after themselves without much if any supervision, and the support is nothing more that checking this occasionally and general help with bills and form filling, then it is unlikely that the landlord will incur greater repair / refurbishment liability than any standard Assured Shorthold Tenancy (AST), so little if any adjustment will be appropriate.
If the client group is one where they need constant attention and help, it is likely that the accommodation will need more regular maintenance and repair. Carpets / decoration / soft furnishings may become damaged more frequently and this added risk will need to be reflected in the rent.
Rent Officers should therefore consider:
- Identifying the client group
- Identifying level of support required - is it general support / care or 24 hour care? This is generally reflected in the gross rent
- Assess the degree of renewals likely - how often will furniture need replacing / repairing? Are carpets and soft furnishings likely to have a shorter life that a “normal” AST?
- How often will re-decoration be required?
- Open market lettings information is often unavailable for supported schemes
- LI generally relates to “standard” ASTs only
- LI therefore needs adjusting dependent on the RO’s assessment of the nature of the client group
- Where the client group is ‘low risk’, adjustment is low.
- Where the client group is ‘high risk’, the adjustment could be higher
It is good practice for local offices to keep a record of rent levels of supported accommodation in their areas so that consistency may be maintained, and any rent levels should be regularly discussed at team meetings to ensure common understanding and consistency of valuation.
Significantly high rent determination
Rent Officers must:
- Look for comparable accommodation in the vicinity
- Use other supported accommodation where HB is being claimed is a guide
- Where no comparable supported accommodation exists, look for similar accommodation in the vicinity where quality is similar
- Take account of evidence of appropriate lettings from similar or adjacent areas
- Widen the area of search if LI is still scarce
- Typically the subject letting will be towards the top of the range of LI
- Decide on the appropriate level of risk (look at the referral details and / or inspect the dwelling)
- Make the adjustment, and state reasoning for determination in case notes or in an attachment to the case
Size and rent determinations
Supported accommodation is typically for 1 room lettings so it is unlikely to require a size and rent determination.
Extra rooms for non-resident carers
Since 1 April 2011, a change in the Housing benefit Regulations allows a claimant requiring a non-resident overnight carer to be allowed an extra bedroom only (not any extra living room). This is only permitted where:
- The claimant is entitled to a non-resident carer as identified on the referral and
- The accommodation includes such an extra room and
- A carer is actually being provided.
The Rent Officer should base their SHR on accommodation including 1 extra bedroom but not any further living room entitlement.
Exceptionally high rent (EHR), local reference rent (LRR) and single room rent (SRR) determinations
The usual rules apply except where the accommodation is identified by the LA as a “Hostel”. If the accommodation is a hostel, then the EHR, LRR and SRR determinations do not apply.
Claimant is a foster care leaver. He lives in a private house with a carer. The carer ensures that the claimant applies for jobs and visits the job centre. Meals are provided and all bills are included in his weekly rent of £170 per week.
This is fairly ‘low risk’ client group, attracting little need for additional management renewals or repairs.
- Gross rent £170, support element £20, net rent £150 per week
- Rent includes heating £10, lighting £5 and hot water £5 per week
- The rent under the tenancy is therefore £130 per week
- The most comparable rent on VIS in the vicinity for a board case is £85 per week
- The significantly high rent is assessed using this appropriate comparable at £85 plus an enhancement for the low risk element at approximately 5% according to the circumstances of the letting and the nature of the accommodation and client group
- Rent Officer determination is SHR = £90 per week
The claimant has physical and mental health issues and requires full time care, including help with eating, cooking, bathing and life skills. No board is provided.
The rent charge is £300 per week and the LA have identified £100 per week for support.
The accommodation is judged to be in a ‘high risk’ group, attracting a more substantial need for additional management renewals and repairs.
- Gross rent £300, support element £100, net rent £200 per week
- Rent includes heating £10, lighting £5 and hot water £5 per week
- The rent under the tenancy is therefore £180 per week
- The most comparable rent on VIS in the vicinity for a board case is £85 per week
- The significantly high rent is assessed using this appropriate comparable at £85 plus an enhancement for the high risk element at approximately 15% according to the circumstances of the letting and the nature of the accommodation and client group
- Rent Officer determination is SHR = £98 per week
Claimant is a foster care leaver. He lives in a private house and care is provided by a third party organisation. The carer provides such services for a number of claimants in similar circumstances across several addresses whenever the claimants require help with completing claim forms and job applications. His weekly rent is £120 per week.
This is a ‘low risk’ client group, attracting little or no need for additional management renewals or repairs.
- Gross rent £120, support element £10, net rent £110 per week
- Rent includes heating £10, lighting £5 and hot water £5 per week
- The rent under the tenancy is therefore £90 per week
- The most comparable rent on VIS in the vicinity for a room is £60 per week
- The significantly high rent is assessed using this appropriate comparable at £60 but the Rent Officer’s opinion of the nature of the client group is that no enhancement is appropriate. The determination is still provided because the LA has designated the case as supported accommodation
- Rent Officer determination is SHR = £60 per week. The Rent Officer adds a comment in remarks to the effect that no adjustment for the support element was deemed appropriate and the LA may want to consider the case under the Local Housing Allowance regime
- Ineligible services
- Support services charges
- Non-resident carers under the size criteria
- Extrapolation, adjustment, interpolation and market differential
Valuation - practice
Considerations of the Rent Officer in making determinations of reasonable market rents.
The role of the Rent Officer is to make rental valuations. When making determinations for the claim-related rent, Rent Officers are determining the rent which, in their professional opinion, the landlord could reasonably have been expected to obtain at the relevant time from a tenant in an open market where no one seeking or taking that particular tenancy was receiving, or intended to apply for, Housing Benefit. In other words, the Rent Officer has to determine the market rent for the premises on the assumption that Housing Benefit has not directly influenced the level of the rent for that tenancy.
The wording of the legislation does not require Rent Officers to ignore Housing Benefit tenancies, but rather determine that Housing Benefit is not affecting or influencing the agreed rent. HB should not be the determining factor in a rent. An example is where a tenant agreed the rent and previously paid this from his or her own pocket without the assistance of HB. There may be areas where in the Rent Officer’s professional judgement HB has not influenced rental levels. If the rents for those tenants known to be assisted by HB are similar or reflect those rents that are not, this may suggest that HB has not influenced rental levels.
In each of the 3 sets of determinations that make up the claim-related rent, Rent Officers may have to make for an HB referral, they have to compare a rental figure against the levels of rent for other properties in the market. The first and best method of valuing such residential rents is to compare an individual rent with recent comparable market rents. This approach is an established valuation principle, upheld by case law and is Agency best practice.
Rent Officers need sufficient knowledge of the workings of the market, and in particular the factors and amenities that influence rental levels, to be able to analyse the lettings information. Factors affecting the market will vary from place to place but are likely to include some or all of the following:
- the quality and quantity of the housing stock itself
- the adequacy and standard of the local transport system
- proximity to shops and banks
- the employment / unemployment rates locally
- the proximity to and standard of local schools
- proximity to other local amenities, like doctors
- the proximity to leisure facilities
- local crime rates
The key points are that in making their valuations Rent Officers must:
- base their rental valuations on confirmed lettings information wherever possible using other data sources including aspirational lettings evidence to support them through the valuation process
- be aware of, and be directed by, the general level of rents for each property type/size
- use the closest comparable evidence
- be prepared to extend their area of search for evidence to achieve this
- exclude the immediate influence of housing benefit on rents
It is important that the same processes, data and time-spans are used to determine all valuations including property specific valuations, Local Reference Rents, Single Room Rents and Indicative Rent Levels, to ensure consistency of approach.
Confirmed lettings information data should be used as the primary source of data for valuations. Rent Officers should ensure that the most recent and up to date evidence is given priority during the valuation process but can be supported by a range of data collected from other sources including:
- Aspirational lettings information data
- Housing benefit referral data, bearing in mind the above and below comments concerning this data
HB tenants form a large part of the private rented market, and cannot be disregarded entirely. However this evidence should only be used alongside confirmed and other aspirational evidence to gain an overview of the entire housing market (for example defining localities and neighbourhoods). It should not be used alone to make property specific determinations or to set the LRR or SRR.
Where properties are in a poor state of repair, the valuation should reflect the condition of the property. The Rent Officer should not solely draw on the number of rooms, the locality and property type to set a rent. The inspection criteria should be used to ensure that any poor properties are inspected including:
- ‘problem properties’ where there is a history of disrepair, or where there is a perception of overcharging and poor management, or
- areas of poor quality property
Where we can demonstrate that, after making every effort to obtain lettings information, very little exists, we may use the techniques of interpolation, extrapolation, differentials and triangulation.
- Low demand areas - valuations
- Lettings information – sources of evidence
- Lettings information – HB
- Inspection criteria
Valuing shared rooms/bedspaces
Rent Officer determinations of reasonable rents where the claimant has no exclusive use of any room.
Referrals for bedspaces or shared rooms, where the claimant does not have exclusive use of any room, present particular challenges.
Significantly high rent
The Rent Officer’s first task is to value the tenancy of the dwelling - so where the tenancy (or, more appropriately ‘licence’ in the case of shared accommodation) comprises just the shared use of a bedroom with no other exclusive accommodation, the following points should be considered.
It is reasonable to expect that where a room is let as bedspaces (under separate agreements to un-connected individuals) each space would command a suitable proportion of the rent that could be achieved if the room were let to one sole occupier. The precise proportion would depend on the number of bedspaces in the room and it may be that the sum of the bedspace rents exceeds the rent achievable for letting to a sole occupier of that room or indeed the rent for a related couple taking the room itself on a joint tenancy. Such factors as the lack of privacy increasing with the number of occupants will be relevant to how much people would be prepared to pay for the ‘bedspace’. Overcrowding as defined by the Landlord and Tenant Act 1985 is a separate matter which is not policed by Rent Officers but may have an impact on valuation.
While Rent Officers will consult the available lettings information (for bedspaces or shared rooms), they may find it helpful to see what rents are charged by local Youth Hostels both for sole rooms and shared rooms. This could assist Rent Officers where bedspace lettings information is limited and where a reasonable approach to comparison and apportionment has to be considered
Rent Officers must not confuse a shared room with one let on a joint tenancy, For a room let on a joint tenancy, where for example a couple take a double room together, the Rent Officer must value the room as a whole - the most relevant lettings information being that which most closely matches the circumstances of the referral. If this is not available in the vicinity, Rent Officers should widen their search. If the entire BRMA(LRR) does not contain sufficient information, Rent Officers may find they need to extrapolate from a comparable area. Just as there must not be confusion between a letting of a bedspace and a joint tenancy of an individual room, the joint tenancy of a room cannot be confused with the joint tenancy of a whole house or flat.
Local reference rent
The local reference rent is a determination that turns on more precise definitions; where the tenancy is for the exclusive use of no more than one room. There are 3 types of Local Reference Rent for tenancies with exclusive use of no more than one room. These are:
- No more than one room let with substantial board and attendance
- No more than one room with shared use of a kitchen, toilet, bathroom and living room
- Any other letting with exclusive use of no more than one room
These are the categories of LRR which would be the ones appropriate for shared rooms / bedspaces, depending on the precise terms of the letting. Therefore the appropriate LRR for a bedspace will be one of these three, depending upon whether or not substantial board is provided and precisely what is shared.
- Rooms – identification – HB and LHA
- Room evidence onto VIS
- Board and other difficult evidence to obtain
- Extrapolation of Lettings Information
- Local reference rent
- Significantly high rent
- Broad rental market areas