The Cambridgeshire Atlas | Local Housing Allowance changes shows the local level effect of some changes to Local Housing Allowances, which relates to housing benefit for households who rent from a private landlord.
The Atlas contains data about private rented housing in Cambridgeshire and West Suffolk and looks at the impact of two headline reforms to these allowances:
Changing the rent local housing allowances will cover
Before 2011 local housing allowances were based on the median market rent being charged across a 'broad rental market area' (BRMA). BRMAs are defined by the Valuation Office Agency. The Cambridge housing sub-region is mostly covered by five BRMAs (shown in the Atlas by black boundary lines).
Using the median market rent level means that half the rents being charge across the area would fall below the LHA rate while half would be above the LHA rate. In 2011 the local housing allowance rate was set at the the 30th percentile rent level, meaning 30% of rents being charge would fall below the local housing allowance rate (rather than 50% in the previous system).
As a result of considerable variation in both cost and availability of privately rented housing across our sub-region, the number of wards where private rents are covered by local housing allowance has decreased, meaning the number of homes available to people who rely on this allowance has also reduced.
Changing the rate of increase for the allowance
In 2012 the government announced that some benefits (including the local housing allowance) would be increased by 1% until 2016. Since rents typically increase at more than 2% each year, the gap between rent and local housing allowance will increase, again meaning fewer homes will be available to low income households by 2016.