Housing Benefit - Non-LHA Housing Benefit Claims

Non-LHA Housing Benefit Claims

For housing benefit claims made before (or still existing at) the roll-out of Local Housing Allowance scheme on 7 April 2008, different rent restriction rules apply.

The earlier system for calculation of eligible rent is specific to the individual property.

The maximum Housing Benefit will be based on:-

• the tenant's actual rent less services if the rent is "reasonable";
• the rent that would be "reasonable" in the area for the size of premises the tenant occupies in comparison to what would have been obtained by the landlord had the property not been rented to someone on Housing Benefit (the claim related rent) or
• the average level of rent that would have been "reasonable" for that type of accommodation in the area (the Local Reference Rent)

or where the tenant has a home too large for the needs

• the average level of rent that would be payable for the type of accommodation reasonable in the area for the actual size of accommodation that the tenant needs for his/her household. (Exceptionally large determination)

Further restrictions can be imposed if the tenant is occupying accommodation in the luxury end of the market.

These restrictions are decided either by the Council, if the property is exempt from the Reference Rent rules and the LHA, or the Rent Service if the benefit being paid is subject to Reference Rent rules.

The Rent Officer may visit the property (or may have done so already) although this is not a requirement. If a property is visited and the Rent Officer is not given access, the Council may terminate the claim, unless access is granted. If there are services included in the rent (such as fuel bills, water charges, laundry or room cleaning), the rent officer will deduct the value of these as Housing Benefit cannot pay for them.

The Rent Officer decision is the maximum that the Council can pay for Reference Rent cases, for cases that are treated under the Pre 1996 rules, the figure is used to decide how much the DWP awards the Local Authority in subsidy and is purely indicative. This decision is made annually, although the Local Council may be late in making the application. If the decision is higher the effective date of the increase will be the Monday of the week of the referral; if the decision is lower, the effective date is the Monday after the new decision is received by the Local Council. This is to avoid overpayments arising as a result of the Rent Service decision. If the decision is lower, any overpayment is LA Error and may only be recovered if it is reasonable to expect that the claimant knew that the decision was going to be lower.

The rent officer makes the following valuations.

Claim-related rent (This has three parts)

Significantly High Rent The rent officer will have decided if the rent your landlord has asked for is reasonable compared with other properties in the vicinity. If it is too high, the rent officer will set a reasonable figure. The "vicinity" means the immediate area around the property. If the property is in a town or city, this could mean just the street the property is in or a few adjoining streets. If the property is in the country, the "vicinity" could be a small village.

The "vicinity" is much smaller than the Broad Market Rental Area used to decide LHA Rates.

Number of rooms (size criteria) The rent officer will consider whether the property has more rooms than the Housing Benefit rules say are needed. If the property has too many rooms, the rent officer will decide what the eligible rent used would be for a similar property with the right number of rooms.

The rules are strict and the rent officer is not able to alter them. If an extra room is needed (for example if the claimant has special disability needs), the claimant should apply to the Council for a DHP.

Exceptionally high rent After having made these decisions, the rent officer decides if the lowest figure is still much higher than most rents for properties in the neighbourhood with the right number of rooms. This might be because of the property is in the luxury end of the market, or because of the services or amenities provided. If it is much higher, the rent officer will decide a figure that is in keeping with the general level of rents. ‘Services’ are things that the landlord does or supplies beyond providing the basic accommodation, such as doing the laundry or cleaning the property. ‘Amenities’ are the physical things at the property, such as a swimming pool or tennis court.

Claim-related rent The lowest of these three figures is called the claim-related rent and is shown on the pre-tenancy determination decision.

Local reference rent The rent officer will also decide how much is generally paid for property with the right number of rooms in the ‘locality’. This is called the local reference rent and will be shown if it is lower than the claim-related rent.

The local reference rent is the midpoint of the range of rents for all types of property with a similar number of rooms in the same ‘locality’ as the claimants home. The ‘locality’ is an area with at least two neighbourhoods. Within this area there will be a mix of property types and alternative places to live within a reasonable travelling distance of similar public amenities. The range of rents used will not include any rent that is unusually high or low.

Single room rent If the claimant is single and under 25, with no non-dependants or children living with the claimant, the rent officer will also decide how much is generally paid in the locality for a single room with a shared living room, kitchen, bathroom and toilet, but without any food or fuel bills included. This is called the single room rent and will be shown if it is lower than the claim-related rent. If the claimant is severely disabled, the Single Room Rent will not be applied.

A more generous rent restriction scheme applies to tenants of charities, voluntary organisations or registered social landlords, whose tenancy includes care support and supervision provided directly by the landlord. These tenants fall under the rules in operation prior to 2 January 1996. Under this scheme rents may only be restricted to the cost of suitable alternative accommodation and in the case of claimants with children, or claimants who are elderly or disabled, the rent can only then be restricted if it is reasonable to expect the claimant to move and if there is accommodation available.