Local Housing Allowance (LHA)

Local Housing Allowance (LHA) is the maximum amount of housing benefit or Universal Credit housing element that a low-income private tenant in England, Scotland, or Wales can receive towards their rent. It is not paid by the Local Housing Authority (the council's enforcement body, see the Local Housing Authority entry for that separate concept). LHA is set by the Department for Work and Pensions (DWP) using rental data collected by the Valuation Office Agency (VOA), which publishes current rates at lha-direct.voa.gov.uk. Rates can be looked up by postcode or local authority area.

How LHA is calculated

LHA rates are set at the 30th percentile of private market rents within each Broad Rental Market Area (BRMA). A BRMA is a geographic zone defined by the VOA, based on where people could reasonably be expected to live given access to services, work, and transport. Setting the rate at the 30th percentile means the LHA is intended to give claimants access to approximately the cheapest 30% of available properties of the relevant size in their area — not the cheapest, and not the median, but a defined slice of the local market.

England is divided into around 150 BRMAs. Rates vary substantially between areas: LHA rates in central London are many times higher than rates in rural areas. Within a BRMA, all claimants receive the same rate regardless of where exactly they rent.

Bedroom entitlement

LHA is based on the number of bedrooms a household is entitled to, not the number of bedrooms in the property they rent. The bedroom entitlement rules are: one bedroom for every adult couple; one bedroom for each single person aged 16 or over; one bedroom for two children of the same sex under 16; one bedroom for two children of any sex under 10; and one bedroom for any other child. Maximum entitlement is four bedrooms regardless of household size.

A critically important rule for landlords to understand: single people under 35 without dependent children are only entitled to the shared accommodation rate, a rate designed to cover a room in shared housing, not a self-contained flat. In many areas, the shared accommodation rate is substantially lower than even the one-bedroom rate, and may not cover the cost of a room in a shared house. Landlords letting self-contained properties to young single adults on benefits need to factor this in when setting rents.

How LHA is paid and when it goes directly to a landlord

LHA is paid to the claimant by default, either as a housing benefit payment from the council, or as the housing element of Universal Credit from DWP. It is the tenant's responsibility to pay the rent to the landlord from this income.

There are circumstances in which the LHA can be paid directly to a landlord. Under Universal Credit managed payments, a landlord can apply for an Alternative Payment Arrangement (APA) where the tenant is: eight or more weeks in arrears; or struggling to manage their finances; or at risk of eviction. The DWP or council also has discretion to make direct payments in other circumstances of vulnerability. Where rent arrears reach eight weeks, applying promptly for an APA is one of the most practical steps a landlord can take.

Landlords letting to tenants who receive LHA or Universal Credit can use August's rent tracking feature to monitor payment patterns and identify emerging arrears before they reach the eight-week threshold that triggers a direct payment request.

The rate freeze position as of 2026

LHA rates were frozen at 2016 levels from 2016 to 2020, then refrozen until April 2024. In April 2024, rates were reset to the 30th percentile of local rents surveyed in the year to September 2023, the first meaningful uprating in four years. However, by DWP legislation, the 2024/25 rate was then fixed for both 2025/26 and 2026/27. As of May 2026, LHA rates have not changed since April 2024 and will not change until at least April 2027.

In areas where private rents have continued to rise since September 2023, which covers most of England, the LHA rate increasingly lags behind actual market rents. For landlords, this means the gap between what benefit-reliant tenants can receive and what the property actually costs is growing, increasing the probability of shortfall and rent arrears for tenants in high-demand areas.

Implications for landlords

Where the LHA rate is below a tenant's actual rent, the shortfall must come from elsewhere, which is a primary driver of rent arrears for benefit-reliant tenants, particularly in high-cost areas where market rents have risen above the frozen LHA ceiling. Landlords in areas with a high proportion of benefit claimants should check LHA rates for the relevant BRMA and property size before setting or reviewing rents, to assess whether benefit-reliant tenants can cover the full amount or whether a shortfall is structurally likely.

Landlords should also be aware that blanket refusals to rent to tenants on housing benefit are unlawful. Under the Equality Act 2010, a "No DSS" policy indirectly discriminates against women and disabled people, who are disproportionately likely to claim benefits, and this has been confirmed in court. The Renters' Rights Act 2025, which came into force on 1 May 2026, formally codifies this prohibition, with penalties of up to £7,000 for a first breach and up to £40,000 for repeat offences. Landlords must assess benefit-receiving applicants on the same basis as any other applicant.

For a full guide to letting to tenants who receive housing benefit or Universal Credit, including how to vet applications, when to request direct payments, and how to handle arrears, see our guide to DWP and DSS tenants.

Frequently asked questions

What is a BRMA?

A Broad Rental Market Area is a geographic zone used by the Valuation Office Agency to determine LHA rates. BRMAs are defined around areas where a person could reasonably be expected to live, based on access to services and employment. England has approximately 150 BRMAs. Everyone within the same BRMA receives the same LHA rate for a given bedroom size, regardless of their exact address within that zone.

Will LHA rates increase in 2026?

No. By DWP legislation, LHA rates were fixed at the 2024/25 level for both 2025/26 and 2026/27. This means rates set in April 2024, based on rents surveyed to September 2023, will remain unchanged until at least April 2027, when the government will make a fresh decision. In areas where rents have risen, the gap between the LHA rate and actual market rent will continue to widen.

Can a landlord refuse to rent to someone on housing benefit?

No. A blanket policy of refusing benefit claimants is indirectly discriminatory under the Equality Act 2010, because women and disabled people are disproportionately likely to claim benefits. The Renters' Rights Act 2025 codifies this from 1 May 2026 with specific penalties. Landlords can assess affordability and references on the same basis as any other applicant, but cannot refuse on the basis of benefit status alone.

Can a landlord get LHA paid directly?

In most cases, LHA is paid to the tenant, not the landlord. However, landlords can apply for an Alternative Payment Arrangement under Universal Credit where the tenant is eight or more weeks in arrears or is otherwise at risk. In housing benefit cases, the council can make direct payments to the landlord in circumstances of vulnerability or persistent arrears. An application should be made promptly when arrears reach eight weeks.