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. Your entitlement to local housing allowance depends on your personal circumstances, such as your income, savings, where you live and the size of your household.
Local housing allowance
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.
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:
- personal banking
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.
Setting local housing allowance rates
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 30th 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. 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 other comparable areas.
Capping LHA rates
The Housing Executive cannot exceed certain caps for LHA rates. These caps were set by the UK Government as a means of preventing the housing benefit bill in expensive areas, like London, from escalating out of control. This means that the LHA rate cannot rise above a certain rate, even if the normal LHA rent setting rules say that the rate should be higher. This rate capping is unlikely to affect people in Northern Ireland. The LHA rate for each property size is capped at:
- £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.
Maximum amount of help that you can 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 particular areas.This means that if you and one child live in Belfast, the Housing Executive will use the LHA rate for a two bedroom property in Belfast as the maximum amount of benefit you'll get for your rent, no matter how much higher your rent may be. You'll also get some housing benefit to help with your rates, if the Housing Executive knows you are responsible for paying rates.
The actual amount of housing benefit you get may not be the full LHA rate set for the property you wish to rent. The Housing Executive must take into consideration your personal circumstances, such as:
- the number of people living with you
- your income and
- your savings.
Some deductions to your allowance could be made if, for instance, you have non-dependents living with you.
The Housing Executive will determine your LHA rate based on the number of bedrooms your household actually needs, rather than the size of accommodation you occupy. If, for example, you are an adult couple living in a 2 bedroom property, you will only be entitled to the 1 bedroom rate of LHA. You may be entitled to an additional bedroom allowance if someone, who does not normally live with you, regularly stays overnight to act as your carer.
The level of housing benefit 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 housing benefit does not cover your full rent you may wish to consider finding more affordable accommodation.
Problems with housing benefit
You are responsible for making sure your claim is up to date and you must tell the Housing Executive about any changes in your personal circumstances which may affect your claim.