Local Housing Allowance - landlords

With Local Housing Allowance, Housing Benefit is not usually based on the property in which the tenant lives. It's based on:

  • who lives with the tenant;
  • which area the property is in;
  • how much money the tenant has coming in; and
  • what savings the tenant has.

In some cases the amount of benefit will be affected by other things. These can include how much the rent is and whether anyone living with the tenant is expected to contribute to their rent.

There is no change to the entitlement rules for Housing Benefit - these will still be based on a person's income, savings and proof of rent etc.

Click here to check the rates for your area

How does local housing allowance affect landlords?

The only change for most landlords is that payment of benefit worked out using the Local Housing Allowance rates will normally be made direct to the tenant. The tenant will be responsible for paying their rent to the landlord.

Which landlords does Local Housing Allowance affect?

Local housing allowance affects any landlord who enters into a deregulated private tenancy agreement with a person awarded Housing Benefit. By deregulated, we mean a tenancy that has been entered into since 1989 and is not covered by one of the exceptions listed below.

Local housing allowance does not affect:

  • council tenants;
  • tenancies with registered social landlords;
  • some supported housing;
  • tenancies which started before 15 January, 1989;
  • tenancies in caravans, houseboats or hostels; and
  • tenancies where the Rent Officer has decided that a substantial part of the rent is for board and attendance (meals).

What protection exists for landlords?

There are a range of safeguards to protect the interests of landlords. 

Payment may be made direct to the landlord where we decide that the tenant is likely to have difficulty in managing their financial affairs or unlikely to pay their rent.

We must usually pay the benefit to the landlord if the tenant is eight weeks or more in arrears with their rent. We recommend that if a tenant is starting to build up rent arrears you should get in touch with us before it gets to eight weeks. This will allow us to investigate whether there is a problem that needs addressing.

Who decides if a tenant is likely to have difficulty in paying their rent?

We'll decide whether a tenant is likely to have difficulty in paying their rent. Evidence will be required to support a request, which can be made by the tenant or other interested party.

You, as a landlord, can approach us if you think it likely that your tenant will have difficulty in paying or you feel they cannot deal with their financial affairs. We'll contact your tenant for further information. It's up to us to decide whether a tenant is unlikely to pay their rent. We can only do this if we have evidence of past, or likely, failure to pay rent. We'll take into account all knowledge and evidence available to us at the time, including any known past history when making our decision. It will also be important for the landlord to keep proper and adequate records of rent payments received and details of any contact made with the tenant.

Can the tenant ask for their benefit to be paid to their landlord?

Tenants cannot simply ask for their benefit to be paid direct to their landlords. If a tenant feels that they may have difficulty in managing their financial affairs and may be entitled to direct payment to their landlord, we will consider any request they make.

Where direct payments are made to me, how long will they go on for?

Where a tenant is considered likely to have difficulty in paying their rent and there is little or no prospect of their situation changing, payment of benefit to the landlord is likely to be long-term. In cases where the situation is likely to be temporary, or where rent arrears of more than eight weeks have been repaid, the situation will be reviewed. If the tenant is in a better position to have their benefit paid to themselves, and to pay their rent in full and on time, direct payments to the landlord will stop.

Can I make direct payment a condition of the tenancy?

We may pay benefit direct to the landlord if it will assist the tenant to secure or retain the tenancy.  It should be part of the tenancy agreement between the landlord and tenant.

What appeal rights do I have against a payment decision?

You will have the right to appeal against a decision by the authority not to make direct payments.

Remember that this information is a guide only. It is not meant to say exactly what your legal rights are. While we have tried to make sure that this information is correct, it is possible that some ideas may be oversimplified. Also, please remember that the information may be subject to changes to the law.