Local housing allowance (LHA) calculates housing benefit for people living in private rented accommodation. The scheme was introduced in April 2008 and applies to certain groups of private tenants. 

If you are an existing claimant you should note that changes introduced in April 2011 and January 2012 are likely to have an impact on the amount of LHA you receive.

Your entitlement to local housing allowance depends on your personal circumstances, such as your income, savings and the size of your household.

• The local housing allowance rules
• What are broad rental market areas?
• How are local housing allowance rates set?
• How much will I get?
• Is LHA replacing housing benefit?

The local housing allowance rules

Local housing allowance rules allow the Housing Executive to calculate your housing benefit entitlements on the basis of local housing allowance rates.

The scheme applies to private tenants in non-rent controlled tenancies and sets out maximum amounts of "eligible rent" for different areas in Northern Ireland, depending on types and sizes of properties within each of these areas.

Tenants who have protected or rent-controlled tenancies, or those renting from a social landlord such as the Housing Executive or a housing association, are not affected by the introduction of LHA.

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What are broad rental market areas?

The Housing Executive has created 8 broad rental market areas (BRMAs) for Northern Ireland. From these, they have examined the range of rents being charged for different types and sizes of properties.

The BRMAs are defined as areas  where you could reasonably be expected to live having regard to the facilities and services which are available for the purposes of:

• health,
• education,
• recreation,
• personal banking,
• shopping.

Travel distances and public transport to and from such facilities also need to be considered. The BRMAs should contain a variety of types of residential property and tenancies.

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How are local housing allowance rates set?

To set the local housing allowance rates, the Housing Executive looks at:

• individual broad rental market areas,
• the range of rents being charged for each type of private rented sector accommodation within them.

The Housing Executive will work out the 30^th percentile of rents charged in each BRMA for a variety of property sizes.  This figure is then set as the LHA rate.  Up to date LHA rates can be found on the Housing Executive’s website.

From 1 April 2011 maximum levels of LHA will be set for each category of dwelling.  These caps are:

• £250 per week for a 1 bedroom dwelling,
• £290 per week for a 2 bedroom dwelling,
• £340 per week for a 3 bedroom dwelling,
• £400 per week for a 4 bedroom dwelling.

LHA will no longer be set for properties with more than 4 bedrooms.

Until 31 March 2011, the Housing Executive set rates at the 50^th percentile of rents charged in each BRMA.  This means that the amount of LHA payable to claimants reduced significantly for new claims made on or after 1 April 2011.  If you made a LHA claim before 1 April 2011 you should continue to  receive the higher rate for a period of 9 months after your claim anniverary.  After this period, your claim will be assessed again at the lower rate of LHA. 

If the Housing Executive decides that the area of your choice doesn't have an adequate amount of rented properties for the purposes of determining your LHA rate, the Housing Executive may look at rents from others comparable areas.

The local housing allowance rates are periodically reviewed by the Housing Executive. Find out more about local housing allowance rates and broad rental market areas which are updated regularly by the Housing Executive.

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How much will I get?

Local housing allowance rates will give you a clearer idea of the maximum level of help you're likely to get for certain types of accommodation in certain areas. For example, if the LHA rate for a two bedroom property in Belfast is £101.50 per week, the Housing Executive would use this figure as your eligible rent to calculate your entitlement.

However, the actual amount you receive may not be the full LHA rate set for the property you wish to rent. Your personal circumstances, such as number of people living with you, your income and savings are all taken in consideration. Some deductions to your allowance could be made if, for instance, you have non-dependents living with you.

The level of LHA that you receive may be less than your monthly rent.  If this happens, you will have to make up the shortfall yourself.  You may be entitled to a Discretionary Housing Payment, but these payments are short term solutions.  If your LHA does not cover your complete rental obligation you may wish to consider finding more affordable accommodation.

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Is LHA replacing housing benefit?

The scheme does not replace housing benefit, but is used as a basis for calculating the maximum amount of help you can get with your rent for the particular property you are renting, in the particular area where you live.

The Housing Executive takes into consideration the size of your household, income and capital to work out the actual amount of assistance you are entitled to.

Find out more about housing benefit and paying your rent.

If you think that you are entitled to help with your rent, submit a claim form to the Housing Executive. The Housing Executive will let you know if you will be entitled to any help depending on your circumstances.

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