Local Housing Allowance (LHA)

Local Housing Allowance (LHA) is the maximum housing benefit/Universal Credit housing element normally paid towards rent for low-income private renters. It is set by the government for each Broad Rental Market Area (BRMA) and property size, based loosely on local market rents.

LHA effectively sets a benefit cap on rent for most tenants who rely on benefits. If your rent is higher than the relevant LHA rate, the tenant must usually make up the shortfall from other income or benefits, which increases arrears risk. Many landlords therefore check LHA rates when setting rents in areas with a high proportion of benefit-reliant tenants.

LHA is paid to the claimant by default, though in some cases it can be paid directly to the landlord. For example, vulnerability or rent persistent rent arrears. Rate freezes and slow uprating mean LHA often lags behind market rents, a growing issue noted in government reviews and landlord surveys.

Under the Renters’ Rights Act, LHA does not change your legal duties on rental standards, notice or redress, but it strongly influences affordability, arrears risk and the viability of lets aimed at lower-income households.

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