Which landlords are affected by Local Housing Allowance?

It affects any landlord who enters into a deregulated private tenancy agreement with a person who makes a new claim to Housing Benefit.  By deregulated we mean entered into since 1989 and not covered by one of the exceptions below.

Who is not affected by Local Housing Allowance?

• Tenancies with registered social landlords (Housing Associations).
• Tenancies that are excluded from current rent restrictions.
• Tenancies in caravans, houseboats and hostels.
• People currently in deregulated private tenancy accommodation and in receipt of Housing Benefit.  As soon as their current claim ceases, their new claim will be worked out by the new rules – Local Housing Allowance.

How does Local Housing Allowance affect Landlords?

The only change for most landlords is that Local Housing Allowance will be paid to the tenant via BACS.  The tenant will be responsible for paying their rent to the landlord.

In recognition of the risk that some tenants may struggle with the responsibility of paying their rent, safeguards will be put in place.  Each Local Authority has discretion in identifying when payments can be made direct to the landlord – Vulnerability and Direct Payments Policy.

We can decide to make payments direct to a landlord in a number of circumstances including:

• If the landlord considers that the tenant is likely to have difficulty managing their own affairs.  Examples of this could include tenants with a learning disorder or a drug or alcohol problem that would mean they may have problems managing a budget.  
• If we consider that the tenant is unlikely to use their Local Housing Allowance to pay their rent.  This could be if we know that the tenant has consistently failed to pay in the past.

For us to implement any of these safeguards, we must have documented evidence, a number of which are documented in our Vulnerability and Direct Payment Policy.