Local Housing Allowance Rates, Eligibility, and Impacts
Are you struggling to afford your rent on benefits? You are not alone. Nearly half of the private renters in the United Kingdom who claim housing benefits experience the shortfall between what they receive and what they actually owe in rent. With rising rents and limited housing stock, Local Housing Allowance (LHA) rates and housing benefits rules are under scrutiny.
The Property Management Company supports landlords and tenants by offering practical guidance on LHA and its impact on renting, eligibility and Housing Benefit rules.
What is the Local Housing Allowance and Housing Benefit?
Housing benefit helps those with low income to cover their rent. Those who rent from a private landlord have payments capped by the Local Housing Allowance, which is based on local rent levels in their area.
The LHA is used to calculate the maximum amount that people renting in the private sector can claim in housing benefit or the housing element of the Universal Credit.
Key points
- The Universal Credit is replacing the housing benefits gradually.
- If you rent from a private landlord, the LHA determines how much benefit you receive.
Who is Eligible for Local Housing Allowance?
You’re eligible for LHA if:
- You rent privately
- You have a low income.
- You are receiving housing benefits or the Universal Credit housing element.
How Local Housing Allowance Works
The amount of LHA depends on a range of factors, including who you live with, their age and where you rent. LHA rates are decided by the Department for Work and Pensions using the data provided by the Valuation Office Agency (VOA).
How is LHA Calculated?
LHA is based on the private market rent paid by the tenants in a Broad Rental Market Area. LHA is based on the 30th percentile local market rents. The current Local Housing Allowance rates by postcode in England calculator is available on the Valuation Office Agency.
Bedroom Entitlement Rules for LHA
Your household size determines your bedroom size. Here is the criteria for bedroom entitlement according to Universal Credit rules.
| Household Member / Situation | Bedroom Entitlement |
| A couple | 1 bedroom |
| A single adult or young person aged 16 or over | 1 bedroom |
| Two children under 10 of either sex | 1 bedroom |
| Two children under 16 of the same sex | 1 bedroom |
| Any other child | 1 bedroom |
| Regular overnight carer (not living with you) | 1 bedroom |
| A child with a severe disability who cannot share a room | 1 bedroom |
| A foster child (or children) | 1 bedroom (up to 52 weeks) |
| A former non-dependant (e.g., child in armed forces on operations) | 1 bedroom (if intending to return) |
Shared Accommodation (Under 35 Rule)
If you are single and under age 35, then you are entitled to the shared accommodation LHA rates. However, you may qualify for the one-bedroom rate if you have sole use of at least two rooms in the property.
If you and your partner share one bedroom and share other rooms like the kitchen, toilet or living room, you also get the shared accommodation LHA rate. This is usually a lower amount than the one-bedroom rate.
There are some exceptions:
- If one of the two is severely disabled and getting middle or higher rate care, part of Disability allowance.
- If one of the two is under 25 and has been under care and housed by a local authority.
Self-Contained Accommodation
LHA for self-contained accommodation differs significantly by location and size. They are generally higher than the shared accommodation. For tenants who qualify for a one-bedroom or larger self-contained properties, LHA will cover the maximum allowance for that household size and location.
Joint Tenants
The joint tenants who are not from the same household, for example, two or three friends share common facilities like the kitchen or the toilet, will get the shared room LHA rate. They will get a one-bedroom rate if they are over 35 and have more than one room.
What are the LHA rates in the UK in 2026?
Despite increasing rents, LHA rents have been frozen from April 2025 through April 2026. LHA rates depend on the:
- Broad Market Rent Areas where the claimant lives
- Types of Living Spaces
Official LHA rates for London 2024/25 are published on the UK Government website.
How to Claim Local Housing Allowance?
You can apply for LHA or the housing element from Universal Credit by following the steps below.
- Check your eligibility criteria for Housing Benefit before you apply from Valuation Office Agency Portal.
- You can either apply through the local council or as part of a Pension Credit claim(if applicable).
- Complete the form and fill in the details of your personal information, income details and housing benefits.
- If you are unsatisfied with the housing benefit decision, you can challenge it by asking the council to reconsider the decision or appealing against it legally.
July 2025 Housing Benefit Changes for LHA
From July 2025, several policy positions have been confirmed
:
- LHA remains frozen, meaning that there are no adjustments for rising rental costs.
- Introduction of quarterly rent monitoring to assess market pressure
- Increased focus on reducing benefit fraud and overpayments
- Expansion of eligibility for single under 35s under Universal Credit Rules.
What are the Impacts of Housing Benefits Changes on LHA Rates?
These changes have major effects on private renters.
Lower LHA Rates
According to these changes, more claimants may qualify for the shared accommodation rates that are significantly lower than one-bedroom LHA rates. For renters, it led to a serious affordability crisis.
For example, a renter in London with a monthly rent of £1,400 may receive an LHA rate of £1,040, which leaves a shortfall of £360 every month. Nationwide, the average gap is around £14 per week or £730 annually.
Affordability Crisis
Tenants are forced to cover the gaps with other income or go into debt. Some renters face eviction or are unable to renew leases. Families are being priced out of the entire areas where Housing Benefit no longer matches the local market.
For example, in Edinburgh or Glasgow, the amount you claim should reflect the current local market. But in reality, these Broad rental market areas are often so big that they rarely reflect the true cost of renting in local communities.
Tenants who are facing shortfalls may consider long-term solutions like energy-efficient upgrades funded through Green Mortgages to reduce overall household costs.
What if Your Rent Exceeds LHA?
You will need to pay the difference yourself if your rent increases above your LHA rate. If you have legitimate circumstances, such as needing to live in a specific area, and your landlord has not agreed to reduce the rent. The rent shortfall can be covered by applying for the Discretionary Housing Payments(DHP) for extra help.   Â
Conclusion
Local Housing Allowance (LHA) plays a significant role for private renters to manage their rent costs. With increasing rents and consistently frozen rates, it seems difficult for renters to afford a home and avoid any shortfalls.
If your rent doesn’t match the benefits amount, report the problem with the respective councils and tools like Discretionary Housing Payments(DHP) help to cover the gap. Taking proactive steps can make a significant difference. Choosing properties within your LHA rates and checking your entitlements regularly can help to stay out of debt and secure stable housing. Landlords looking for reliable rental income may benefit from exploring guaranteed rent schemes that provide payment security regardless of tenant benefit status.
