Local Housing Allowance & Renting in the Private Rented Sector

David2710

I will shortly be looking to rent a one bed property in the Private Rented Sector and would appreciate any advice in regards to Local Housing Allowance. I am reliably informed I qualify for the maximum amount. So I am looking at properties from as far afield as Doncaster (Max LHA £373 pcm) to London (Max LHA £1,280 pcm). My question is do private landlords take into account my eligibility for maximum LHA when calculating affordability? I don't want to get to a stage where I'm ready to sign on the dotted and told my facts are wrong. Also I note that despite legal precedent there are still landlords advertising properties stating "NO DSS". Is that code for no LHA or sickness benefit? Thanks again.     

theartfullodger

I speak as someone with 6 benefits (old, 73), and, apologies all, also a landlord.

You may well have been informed you qualify for full LHA but until you apply, with a tenancy arranged & probably moved in, you won't know until you get a reply (will take weeks). And eg if rent if less than max LHA then you'll only get rent.  And the landlord won't know what you will qualify for until council/UC decide. So it's  a gamble for them also.

Is it just you , are you over 34, any other residents? Are you working ? (About 1 million in receipt of some HB or UC/HE are in paid work).

Different agents and landlords have different assessment criteria to decide who to take.  Other than no unlawful discrimination (including now "DSS" - even though DSS was dissolved in 2001) mainly up to them.

One of my best tenants ever were recently arrived eastern Europeans where the only history or reference I had was a neighbour (whom I'd know for some years) said "Mr Artful they very nice people".  And they were.

Good luck.

ripplyuk

‘No DSS’ basically means they don’t want tenants on benefits. Some landlords really mean they don’t want those who are unemployed while others will refuse those who receive LHA, even if they are working. 

The landlord will not be remotely interested in how much LHA you get. The letting agents will ask but the fact that you get LHA at all will make it harder to find a house. Keep in mind that the LHA almost never covers the full amount of rent so you will need to top it up yourself, often by a significant amount. 

David2710

ripplyuk said:

‘No DSS’ basically means they don’t want tenants on benefits. Some landlords really mean they don’t want those who are unemployed while others will refuse those who receive LHA, even if they are working. 

The landlord will not be remotely interested in how much LHA you get. The letting agents will ask but the fact that you get LHA at all will make it harder to find a house. Keep in mind that the LHA almost never covers the full amount of rent so you will need to top it up yourself, often by a significant amount. 

Thanks for the reply. A few points if I may. Why would landlords not be "remotely interested" in what is pretty much a guaranteed income? Much safer than say an employed couple during the pandemic imho. Yes I can understand the reasoning if there's a clause in a Btl mortgage for instance, but as far as I'm aware most banks/lenders have subsequently withdrawn the clause due to media pressure and legal precedent. Finally I agree many rental properties far exceed the max LHA but many are well below the LHA max. Thanks for the advise but unless your reasoning is based on discrimination (against people on benefits) I don't see the logic from a landlords perspective.

David2710

theartfullodger said:

I speak as someone with 6 benefits (old, 73), and, apologies all, also a landlord.

You may well have been informed you qualify for full LHA but until you apply, with a tenancy arranged & probably moved in, you won't know until you get a reply (will take weeks). And eg if rent if less than max LHA then you'll only get rent.  And the landlord won't know what you will qualify for until council/UC decide. So it's  a gamble for them also.

Is it just you , are you over 34, any other residents? Are you working ? (About 1 million in receipt of some HB or UC/HE are in paid work).

Different agents and landlords have different assessment criteria to decide who to take.  Other than no unlawful discrimination (including now "DSS" - even though DSS was dissolved in 2001) mainly up to them.

One of my best tenants ever were recently arrived eastern Europeans where the only history or reference I had was a neighbour (whom I'd know for some years) said "Mr Artful they very nice people".  And they were.

Good luck.

Thanks for the reply. No I am not currently working and am claiming ESA (sickness benefit). I am over 60yrs old and single. Please can you explain in what circumstance I as a tenant would receive less than the maximum LHA as I currently receive the maximum allowance ? As an existing private tenant with a good credit history and excellent landlord references this is exactly the kind of information I was looking for. I'm just doing some ground work before I receive my notice to quit as my current landlord is selling up. 

theartfullodger

It's guaranteed until government changes rules on entitlement or amount (Rishi needs to save a lot of money due to Civid & Brex****) or until the tenant (no offence, obviously not you..) turns out to not be entitled to the benefit in the 1st place (oh it happens,,,) or tenant's circumstance change and no longer entitled/ only entitled to a lot less.

Discrimination may be lawful: e.g. Liverpool FC usually only sign people for the 1st team if they can play football well.  I prefer to discriminate in favour of tenants with a track record of looking after a property: Both entirely legal.

For what it's worth I've always ignored mortgage conditions about not taking benefit tenants, but that's just me, my decision.

Best wishes.

Murphybear

My husband and I were looking for a rental 3 years ago.  We were both retired and eligible for some LHA.  What was interesting is that one big agency said “no DSS doesn’t apply to retired people”.  We found this attitude quite common.  There is a massive difference between being unemployed and not working but having a guaranteed income ie pension(s).  One agency told us that ~ 70% of their tenants were retired.  We were looking mainly in rural Devon.  

What we did find was that there were a number of suitable properties that were affordable even without claiming LHA.  We also found that the perception of letting agents/landlords was that retired people would be more settled than younger ones and not start a family.  One actually said to us “you don’t look like you’ll have wild parties”.  

hope this helps 

ripplyuk

David2710 said:

ripplyuk said:

‘No DSS’ basically means they don’t want tenants on benefits. Some landlords really mean they don’t want those who are unemployed while others will refuse those who receive LHA, even if they are working. 

The landlord will not be remotely interested in how much LHA you get. The letting agents will ask but the fact that you get LHA at all will make it harder to find a house. Keep in mind that the LHA almost never covers the full amount of rent so you will need to top it up yourself, often by a significant amount. 

Thanks for the reply. A few points if I may. Why would landlords not be "remotely interested" in what is pretty much a guaranteed income? Much safer than say an employed couple during the pandemic imho. Yes I can understand the reasoning if there's a clause in a Btl mortgage for instance, but as far as I'm aware most banks/lenders have subsequently withdrawn the clause due to media pressure and legal precedent. Finally I agree many rental properties far exceed the max LHA but many are well below the LHA max. Thanks for the advise but unless your reasoning is based on discrimination (against people on benefits) I don't see the logic from a landlords perspective.

Most landlords don’t see it as a guaranteed income. For a start, there’s no guarantee that you will give that money to the landlord at all. Your LHA goes to your account (apart from some limited circumstances) and you can spend it as you please. The amount is also liable to change if your circumstances change. Perhaps if you got a job, or you lost one benefit which then affects your entitlement to other benefits, including LHA. Or the government could decide to reduce benefits rates further. 

Much of the reluctance to have ‘DSS’ tenants is simple prejudice and snobbery. There’s a misconception that ‘professional’ people will take better care of the property but there’s also other reasons like the belief that it will be much harder to evict a tenant who is on benefits, as they will hold out for council housing. Some landlords prefer people who are out at work most of the time as they think it reduces wear and tear. 

IME, it’s the agents who are the most opposed to tenants on benefits. The landlords themselves can sometimes be a bit more reasonable. In fact, I’ve known landlords who had no idea their agent was turning away potential tenants purely because they were receiving LHA. 

elsien

It’s also got worse since the advent of UC.
The different assessment and run in periods (for example with working people where two months wages fall into one assessment period) and the delays in getting paid in the first place has meant that more people on UC have had issues paying their rent than they did on housing benefit. Often through no fault of their own, but it has made landlords understandably more cautious. 

David2710

theartfullodger said:

It's guaranteed until government changes rules on entitlement or amount (Rishi needs to save a lot of money due to Civid & Brex****) or until the tenant (no offence, obviously not you..) turns out to not be entitled to the benefit in the 1st place (oh it happens,,,) or tenant's circumstance change and no longer entitled/ only entitled to a lot less.

Discrimination may be lawful: e.g. Liverpool FC usually only sign people for the 1st team if they can play football well.  I prefer to discriminate in favour of tenants with a track record of looking after a property: Both entirely legal.

For what it's worth I've always ignored mortgage conditions about not taking benefit tenants, but that's just me, my decision.

Best wishes.

OK thanks for clearing that up, most helpful. From that answer it appears there are no reasons I cannot view a property and be fairly confident my application would be successful subject to credit checks and references. Obviously there's no knowing what the future holds in an upcoming budget but if in the unlikely event LHA is reduced I can always move to a less expensive area. Dishi Rishi is not going to want to upset red wall voters so it's more likely he'll increase LHA than do anything silly imho.  Thanks again.   

David2710

Murphybear said:

My husband and I were looking for a rental 3 years ago.  We were both retired and eligible for some LHA.  What was interesting is that one big agency said “no DSS doesn’t apply to retired people”.  We found this attitude quite common.  There is a massive difference between being unemployed and not working but having a guaranteed income ie pension(s).  One agency told us that ~ 70% of their tenants were retired.  We were looking mainly in rural Devon.  

What we did find was that there were a number of suitable properties that were affordable even without claiming LHA.  We also found that the perception of letting agents/landlords was that retired people would be more settled than younger ones and not start a family.  One actually said to us “you don’t look like you’ll have wild parties”.  

hope this helps 

Thanks for that, most interesting. Having just turned 60 I have a few more years yet before I can rest easy in regards to renting in the private sector. I did enquire at my local council whether there are any schemes for the over 60's on ESA but haven't received a reply as yet. Incidentally I have been on the councils housing list for over a decade but because I live in a private rented property I am not considered a priority,. It's a catch 22 situation and if I took the councils advice, to move up the priority list, I would have to be forcibly evicted, I presume by not paying the rent for 6 months.  They would then probably place me in temporary accommodation, maybe a hostel or a B&B for months if not years and my credit history and landlord references will be shot to pieces. It's a complete nightmare in the making so I am sticking to the private rented sector for now at least.