Changes for tenant on benefits to impact landlords

Implementation of the Government’s new Local Housing Allowance (LHA) for recipients of the existing Housing Benefit (HB) will have implications for landlords who provide privately rented accommodation to people on benefit.

In the majority of cases the LHA will be paid to the tenant, who will take over responsibility for paying rent to the landlord. This represents a significant change from the existing procedure whereby HB can be paid direct to the landlord.Part of the Welfare Reform Act 2007, the LHA has been introduced in a small number of pilot local authorities and will be rolled out nationally from 7 April 2008.

David Salusbury, chairman of the National Landlord’s Association (NLA), said could lead to less security for landlords as it could lead tenants falling into arrears. He added: “This leaves open the possibility that the tenant may be tempted to use the money for something else and not pay their rent. This might be because of other pressing financial needs. Ultimately that could threaten the security of their home.”