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SarahBell

Lha Rule Changes

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Different rules apply to ongoing existing Housing Benefit claims made before April 2011.

Before committing to a new tenancy, you are advised to seek advice and look up the Shadow 30th Percentile LHA rates, with caps applied. These give an indication of future differences to LHA rates from April 2011:

https://lha-direct.voa.gov.uk/Secure/LHARateSearch.aspx?SearchType=PostCode

http://www.voa.gov.uk/LHADirect/Documents/LHA_percentile_rates_Mar_2011.html

The key changes from April 2011

LHA levels will be restricted to the 4 bedroom rate and a new upper limit will be introduced for each property size, with upper limits (capping) set at: £250 a week for a 1 bedroom LHA rate

£290 a week for a 2 bedroom LHA rate

£340 a week for a 3 bedroom LHA rate

£400 a week for a 4 bedroom LHA rate (maximum)

* The Government will end the maximum £15 weekly Housing Benefit excess that some people now receive. This means you will not be able to get more money from Housing Benefit than you pay in rent.

* Where you have an extra bedroom that is used by someone whilst providing necessary overnight care for you or your partner this can be included where the carer lives elsewhere. If you are unsure about whether this extra room allowance might apply speak to the Housing Benefit team in your local authority.

* Local Housing Allowance rates will reduce to a lower amount so that about 3 in 10 properties for rent in the area should be affordable to people on Housing Benefit rather than 5 in 10 properties as now. The new rates will be at what is known as the 30th Percentile.

For Oldham

157 Oldham & Rochdale the changes are thereabouts:

£58.50 £91.15 £103.85 £122.31 £160.38 £219.23

£54.00 £84.23 £98.08 £114.23 £144.23

A local landlord has a property on for rent at £700 a month. It's only a 3 bed place. Current occupents paying about 550 I think.

So max his property is worth in LHA now is £494.99

So his house purchase of £130k now looks less attractive.

Edited by SarahBell

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Maybe it's my imagination, but rental asking prices for bigger houses in the southeast seem to be taking a nosedive over the past week or so. Lots of place that were put on the market at the end of last year are now knocking a few hundred (if not a thousand) pounds off the asking rent. I wonder if landlords are trying to find tenants before the change is implemented?

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It's still way too much. A 2 bed flat Southwest London is £288. That's £14,976 per year.

I pay 20% less than that for a perfectly good flat.

down on a quiet industrial estate in a nice campervan thats where you would find me if i had to pay anything like that, i realy saddens me why millions dont just do that. i did it for over a year allready in the countryside. if you all did that the market would be completely stuffed, the government would take action, they would have to or they would lose control over the young folk.

"and the best thing is we dont pay no council tax" paddy & max

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Maybe it's my imagination, but rental asking prices for bigger houses in the southeast seem to be taking a nosedive over the past week or so. Lots of place that were put on the market at the end of last year are now knocking a few hundred (if not a thousand) pounds off the asking rent. I wonder if landlords are trying to find tenants before the change is implemented?

THE FACT IS THAT RENTS ON HOUSES, TYPICALLY OF UNINTENDED LANDLORDS, OFTEN 3-4 BEDS SEMI OR DETACHED, HAVE ACTUALLY FALLEN IN THE PAST YEAR. RENTS FOR 1 AND 2 BED FLATS HAVE GONE UP BECAUSE OF PEOPLE'S DIRE FINANCIAL POSITION. THE TRADING DOWN EFFECT IS PUSHING UP RENTS AT THE LOWER END. PERIOD.

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Different rules apply to ongoing existing Housing Benefit claims made before April 2011.

Before committing to a new tenancy, you are advised to seek advice and look up the Shadow 30th Percentile LHA rates, with caps applied. These give an indication of future differences to LHA rates from April 2011:

https://lha-direct.voa.gov.uk/Secure/LHARateSearch.aspx?SearchType=PostCode

http://www.voa.gov.uk/LHADirect/Documents/LHA_percentile_rates_Mar_2011.html

The key changes from April 2011

LHA levels will be restricted to the 4 bedroom rate and a new upper limit will be introduced for each property size, with upper limits (capping) set at: £250 a week for a 1 bedroom LHA rate

£290 a week for a 2 bedroom LHA rate

£340 a week for a 3 bedroom LHA rate

£400 a week for a 4 bedroom LHA rate (maximum)

* The Government will end the maximum £15 weekly Housing Benefit excess that some people now receive. This means you will not be able to get more money from Housing Benefit than you pay in rent.

* Where you have an extra bedroom that is used by someone whilst providing necessary overnight care for you or your partner this can be included where the carer lives elsewhere. If you are unsure about whether this extra room allowance might apply speak to the Housing Benefit team in your local authority.

* Local Housing Allowance rates will reduce to a lower amount so that about 3 in 10 properties for rent in the area should be affordable to people on Housing Benefit rather than 5 in 10 properties as now. The new rates will be at what is known as the 30th Percentile.

For Oldham

157 Oldham & Rochdale the changes are thereabouts:

£58.50 £91.15 £103.85 £122.31 £160.38 £219.23

£54.00 £84.23 £98.08 £114.23 £144.23

A local landlord has a property on for rent at £700 a month. It's only a 3 bed place. Current occupents paying about 550 I think.

So max his property is worth in LHA now is £494.99

So his house purchase of £130k now looks less attractive.

So if you are letting a 5 bedder there you would have got £219.23 per week but now it is £144.23? £950 a month down to £625?

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So if you are letting a 5 bedder there you would have got £219.23 per week but now it is £144.23? £950 a month down to £625?

Yep, but the saints in the current government have anticipated this and given councils loads of cash to give discretionary payments to keep those who can't do without a 5 bed or larger home enough money to ride it out at least until the next election.

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For Oldham

157 Oldham & Rochdale the changes are thereabouts:

£58.50 £91.15 £103.85 £122.31 £160.38 £219.23

£54.00 £84.23 £98.08 £114.23 £144.23

A local landlord has a property on for rent at £700 a month. It's only a 3 bed place. Current occupents paying about 550 I think.

So max his property is worth in LHA now is £494.99

So his house purchase of £130k now looks less attractive.

HB fodder in Oldham costs 60K.

Anyone with a 130K house in that area letting to HB tenants is letting to the wrong people!

tim

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it's still a shitload of money

True, but if you believe that market rents are efectively set by housing benefit levels, and I do, this will have the effefct over time of driving rents down as opposed to pumping them up as at present.

The LHA amounts will then of course decrease with them, tigtening the noose.

Edited by Laughing Gnome

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True, but if you believe that market rents are efectively set by housing benefit levels, and I do, this will have the effefct over time of driving rents down as opposed to pumping them up as at present.

The LHA amounts will then of course decrease with them, tigtening the noose.

Except that the policy is to limit HB to the thirtieth percentile only for a couple of years. After that the plan is that HB limits will increase in line with CPI. The effect of which will be to drive all rents up by CPI every year.

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Except that the policy is to limit HB to the thirtieth percentile only for a couple of years. After that the plan is that HB limits will increase in line with CPI. The effect of which will be to drive all rents up by CPI every year.

I take it when Universal Credit kicks in that the housing element will then increase by CPI every year. Still if claimants are given a lump sum to spend on everything instead of a certain amount earmarked for rent only there will be an incentive to negotiate rents down.

Too bad when LHA was first introduced it increased rents by as much as 50% in some of the most blighted areas.

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Except that the policy is to limit HB to the thirtieth percentile only for a couple of years. After that the plan is that HB limits will increase in line with CPI. The effect of which will be to drive all rents up by CPI every year.

If it's 30th percentile, it's 30th percentile isn't it?

I'm imagining that this is the start of the government cutting down on HB payments. As the government has to cut spending, I see them favouring reducing HB and if rents come down and therefore the 30th percentile comes down even further, that will be a good thing. I think they'll prefer that than freezing wages and making people redundant. I could be wrong. But a comfortable life on benefits doesn't really seem appropriate in an age of austerity.

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If it's 30th percentile, it's 30th percentile isn't it?

I'm imagining that this is the start of the government cutting down on HB payments. As the government has to cut spending, I see them favouring reducing HB and if rents come down and therefore the 30th percentile comes down even further, that will be a good thing. I think they'll prefer that than freezing wages and making people redundant. I could be wrong. But a comfortable life on benefits doesn't really seem appropriate in an age of austerity.

It's only 30th percentile for a couple of years. Then whatever the rate is at that point gets increased automatically by CPI every year regardless of whether the private sector average is increasing, static or decreasing. Theoretically - and not unreasonably given that, for example, my rent hasn't increased in four years - you could see a situation where the HB level creeps back up to the private sector average, from which point the built-in CPI escalator starts driving everything up.

Essentially the government appears to have fallen for the line that rents always go up every year (like house prices :D ) and have devised a system that will actually make this the case.

But I would imagine austerity will force the government to realise this at some point and keep the 30th percentile scheme.

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This is really interesting. I checked out my area from the link (Central/North London) ... Central London rate very different from Inner North London rate ... the dividing line crosses one of the main roads nearby. For a 2-bed flat, the Central London HB allowance is £550 a week, whilst Inner North London is £350 a week. Both now go to £290 a week. Maybe this puts pressure on the Central London prices more than the outskirts, as they will have much bigger HB reductions.

Am amazed HB was up to £550 a week for a 2-bed flat in Central London, I've lived in a few areas, all very nice and in nice flats, and have never had to pay that (usually 400-550 range gets you a pretty decent 2-bed wherever you want to stay).

Edit: to clarify my ramblings...

Edited by tboy

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This is really interesting. I checked out my area from the link (Central/North London) ... Central London rate very different from Inner North London rate ... the dividing line crosses one of the main roads nearby. For a 2-bed flat, the Central London HB allowance is £550 a week, whilst Inner North London is £350 a week. Both now go to £290 a week. Maybe this puts pressure on the Central London prices more than the outskirts, as they will have much bigger HB reductions.

Am amazed HB was up to £550 a week for a 2-bed flat in Central London, I've lived in a few areas, all very nice and in nice flats, and have never had to pay that (usually 400-550 range gets you a pretty decent 2-bed wherever you want to stay).

Edit: to clarify my ramblings...

550 a week? FFS - what is that pretax? It looks like about £35k pre tax just to pay RENT ffs.

And they give this away for free, while I slog in paying a couple of grand a year to travel 2 hours a day on a ******ing train? Past the point of taking the piss. Ship the work dodgers out to the country side and free up some sensibly priced housing for people who work a living.

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550 a week? FFS - what is that pretax? It looks like about £35k pre tax just to pay RENT ffs.

And they give this away for free, while I slog in paying a couple of grand a year to travel 2 hours a day on a ******ing train? Past the point of taking the piss. Ship the work dodgers out to the country side and free up some sensibly priced housing for people who work a living.

Yeah but as soon as you say that, they'll show you some working class kings cross resident whose parents lived there all their lives, with some sort of huge disability and they'll ask how can you possibly ask poor Johny to fck off and live in Tottenham.

I agree with you though, it's a joke that people have to commute to work, so soap dodgers can do some inner city living.

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Yeah but as soon as you say that, they'll show you some working class kings cross resident whose parents lived there all their lives, with some sort of huge disability and they'll ask how can you possibly ask poor Johny to fck off and live in Tottenham.

I agree with you though, it's a joke that people have to commute to work, so soap dodgers can do some inner city living.

What about poor richb that has to live 2 hours drive from his mummy and daddy so he can work to pay the rent?

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What about poor richb that has to live 2 hours drive from his mummy and daddy so he can work to pay the rent?

You don't count. You should, but you don't. For some reason, we as a society consider it unreasonable to ask people on benefits to accept the sort of compromises that many (possibly most) people in employment have to make in order to get their money. I've tried to figure out why that should be but without any success.

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You don't count. You should, but you don't. For some reason, we as a society consider it unreasonable to ask people on benefits to accept the sort of compromises that many (possibly most) people in employment have to make in order to get their money. I've tried to figure out why that should be but without any success.

I suspect the answer lies back to the times of the French Revolution and fear of violent revolt. Or early 80s Brixton/Toxteth. Same point, though.

P1sses me off no end when I hear magazine articles where those on massive rents say they can't possibly contemplate moving when I've had to move home at least 6 times for work or career-related reasons.

Re the disableds, I believe there's funds for them to stay where they are if they are considered special cases by the council.

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  • 317 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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