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Government must stick to its Local Housing Allowance promise

"The Government promised before the election that they would tackle the Local Housing Allowance (LHA) rent arrears waste which is running into the millions. It is an easy step to introduce choice for LHA tenants and enable them to have their LHA payment made directly to their landlord, if they wish to.

"The National Landlords Association (NLA) is only asking Ministers to give LHA tenants the same choice available to most people when they set up a direct debit or standing order for their rent."

LHA is one of the most important, and potentially damaging, issues currently facing the private-rented sector. Introduced in 2008 to replace Housing Benefit, LHA was intended to empower tenants and provide greater choice for benefit recipients. In reality it has led to a reduction in available housing stock and compelled many landlords to leave the market.

The NLA has been campaigning against LHA from the outset because it believes landlords should not have to risk higher levels of rent arrears just because they let to housing benefit claimants. As always, it is the most vulnerable tenants who are affected by landlords withdrawing from this part of the rental sector.

•In 2009 NLA research found that 949 landlords had lost £4,229 million from LHA-based rental arrears.
•There are now 993,000 LHA recipients in the UK, a growth of 47 per cent since the NLA published its research.
•The average weekly LHA award is £112.85, so a landlord can incur eight weeks of arrears, which would equate to an average of £902.8, before local authorities will take action.

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0 thoughts on “Government must stick to its Local Housing Allowance promise

  1. Major Landlord says:

    Given that a significant proportion of LHA claimants are claiming benefit for the very reason that they have proven incapable of managing their own lives and finances, and are often described as “vulnerable”, how did it ever make sense for the LHA to be paid direct to them rather than to their landlord?

    I was told by a senior executive of my local council’s housing department that this crazy policy stemmed from an individual in the last government who had a bee in her bonnet about “empowerment”. Now that cartloads of managing agents (fearing for their relationships with their landlord clients) and landlords (fearing for their rents) have slammed the door on all benefit claimants, I hope said lady is proud of her achievement in adding to the much-trumpeted “housing crisis”.

    Personally, I still accept claimants: but ONLY if they provide a guarantor, and ONLY if they pay a higher deposit. Most are not able to do either, and I have to turn them away. In the last two weeks, I have had calls from LHA claimants who are at their wits’ end trying to find somewhere to live. They called me on spec through recommendation, even though I was not advertising property, and have no vacancies, so could not help them.

    When is this crazy policy going to be overturned? Does any government think that landlords – already the automatic losers in any dispute with tenants – are going to add to their risks by accepting tenants who cannot pass any financial safety checks, and with no guarantee their rent is going to be paid? If Grant Shapps deals with this, half the “housing crisis” will be solved overnight.