Last week Jeremy Hunt announced in the Autumn statement that the freeze on Local Housing Allowance will be lifted in April 2024
What is the LHA?
The Local Housing Allowance is the rate used to work out what people can claim in financial help from the government when renting from a private landlord. It’s based on the number of bedrooms you need (not how many the property has). So, for example, the rate for a 1-bedroom flat in Colchester is £120.82 per week. But with the average 1-bed property costing over £800, the shortfall is too much for those relying solely on benefits.
The big freeze
The rates were frozen in 2020 which has had a detrimental effect on many low-income households. As the rental prices increased the financial help from government stayed the same. This has lead to more and more people getting behind with their rents or unable to find an affordable place to live in the first place. We find that once residents are ready to move on and look for somewhere more permanent to live, there’s not much for them reasonably priced for them to go to. Most of our guests desperately want to get back into employment, but they need somewhere to reside before taking on that responsibility. So finding somewhere that is affordable while relying solely on benefits is near-on impossible.
A brighter future
This may all sound a bit bleak, but we do have an amazing team of staff working tirelessly to build connections with socially responsible landlords and supported living associations. We also link up with Peabody Outreach, Beacon House, Community 360 and RAMA to offer holistic support for our guests. At time of publishing, we have a 73 percent positive move on rate for this quarter, which is the highest it’s ever been. We’re hoping that when these new rates come in there will be more opportunities for residents to move on and start over.
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