Changes to Local Housing Allowance

Local Housing Allowance Changes

Local Housing Allowance rules are changing as part of the government's welfare reforms. Details of the main changes are below. Dates given for the changes are for new claimants - people who are already getting Housing Benefit will be allowed more time (see bottom of page).

  1. From April 2011, rules that allow people to keep up to £15 a week if their rent is less than their Local Housing Allowance will be abolished
  2. From April 2011 Local Housing Allowance will be restricted to a maximum of four bedrooms rather than five bedrooms
  3. From April 2011, Local Housing Allowance rates will be capped at £250 per week for a one bedroom property, £290 per week for a two bedroom property, £340 per week for a three bedroom property and £400 per week for four bedrooms
  4. From April 2011, Local Housing Allowance rates will be set at the 30% rent level for the local area rather than the median (50%) rent level. This means that about 3 in 10 properties for rent in the area should be affordable to people on Housing Benefit rather than 5 in 10 properties
  5. From January 2012, single people aged under 35 will be assumed to be living in shared accommodation. This means the maximum amount they can get is set in relation to the cost of renting a room in a shared house or flat, rather than the cost of renting a self-contained property. At the moment this restriction applies to single people aged under 25
  6. From April 2013, Local Housing Allowance rates will be increased in line with CPI inflation rather than in line with rent levels

When will your Housing Benefit be affected by the April 2011 changes?

From April 2011 all new Housing Benefit claims by private sector tenants will be calculated under the new rules.

If you are already getting Housing Benefit you will not normally be affected by change 1 until the anniversary date of your claim (the date you first made your current claim). In the case of changes 2, 3 and 4 you will not normally be affected until nine months after the anniversary date of your claim. For instance, if your Housing Benefit claim started on 1st May 2009 then your claim will be re-calculated from 1st February 2012 (your anniversary date is 1st May but a further nine months is allowed before the rule change affects you). However, if after 1st April 2011 someone stops living with you, or if you move house, then the new rules will take effect immediately. If there is an increase in your bedroom entitlement after 1st April 2011, for instance because someone comes to live with you, then, if your Local Housing Allowance under the old rules is higher than the new amount, your entitlement will be calculated under the old rules for the first nine months after which the new rules will take effect.

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