Changes to housing Benefit amounts during Covid-19

Gibby2000

Can anyone explain what the following actually means, more specifically the mention to the “bottom 30% of local rents”,as I am struggling to understand what this means. Does this mean that renters will be getting a 30% raise to their current housing benefit or Universal Credit Housing Benefit element amount? 

”The amount you can currently get in local housing allowance depends on where you live and what kind of accommodation you live in. You can check current local housing allowance rates for your area using local council websites. Local housing allowance has been frozen for several years, but today's announcement means that your local housing allowance will cover at least the bottom 30% of market rents in your area, according to your housing type.”

Thanks in advance. 

SG. 

[Deleted User]

I'm also curious about this.   Also, is this something that we need to do anything about so that it is applied to our HB award? 

calcotti

When LHA was originally introduced it was set at the 50th percentile of rents in the local area. This means that 50% of the properties available to rent would be fully covered by the LHA. (The mathematicians among you will correct me if that's wrong).

The coalition government subsequently reduced it to the 30th percentile (I think in 2011). Since then the coalition and conservative governments have only increased the LHA from the 2011 amounts by inflation (think they were also frozen for a bit) although rents have risen faster than this. As a result it has been increasingly difficult for renters to pay their rent and in almost all cases they are funding their rent from money which is meant to be available for other bills,

The emergency announcement reinstates the link to the 30th percentile so 30% of properties in an area will have rents that would be completely covered by LHA.

Although this is an emergency measure it will be interesting to see how the political optics would play out if the government does cut the rates again in 12 months time. I suspect (and hope) that the 30th percentile will continue - charities have been urging this for some time.

[Deleted User]

Thanks, Calcotti.    I wonder how long it will take for this change to be made, and when we will see the difference in our fortnightly HB payments.

calcotti

Poster_586329 said:

Thanks, Calcotti.    I wonder how long it will take for this change to be made, and when we will see the difference in our fortnightly HB payments.

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-guidance-for-employees says the increase will be from April so presumably it will be in your first payment after then.