Councils are wary of abuses to the Local Housing Allowance (LHA) framework by private landlords and as Bill Irvine explains below, have left some innocent private landlords in the lurch. Bill Irvine explains rules and regulations surrounding an appeals process and how he has helped a private landlord regain tens of thousands of pounds back.
Housing Benefits (HB) expert, RLA trainer and consultant Bill Irvine understands the details when it comes to housing benefits in their various guises and has helped landlords recoup losses from local councils and problematic tenants. Below is how he helped a landlord win appeals against a local council:
“I was asked recently if the “two exclusive rooms” approach was still alive and kicking. I confirmed it was, and would remain so, as long as housing benefit (LHA) legislation (Regulation 13 (D) (2) (b) (i) of the HB Regulations, 2006) remains or the person moves to Universal Credit (most likely in 20016/7 at the earliest for most tenants) as this provision won’t apply to Universal Credit (UC).
The key to success in such cases is:
- Set up two separate tenancy agreements; each specifying which rooms the tenant (who must be 35+ or severely disabled) has exclusive use of;
- Rooms are defined as a bedroom OR room “suitable for living in” (lounge) and does not include kitchens/bathrooms etc.
- As well as the two rooms the tenant will be expected to share the communal facilities (kitchen/bathroom/conservatory etc.
Most awards are made where two single adults over 35 share a 3/4 bedroom property. The landlord identifies the rooms for each tenant and usually provides locks to ensure privacy/exclusivity.
I represented in the first large successful appeal case (CXG) about 3 years ago. Since then I’ve dealt with many other situations where councils have been reluctant to accept the provision or maintain its use is an abuse of the LHA scheme. In most instances I’ve been able to remedy the problem with a few e-mails spelling out the regulations, guidance and importantly, the caselaw.
Notwithstanding the above, I dealt with 4 tenant appeals, where the council HB Manager took a clear personal dislike to the landlord and just point blankly refused to budge despite my efforts to persuade her otherwise.
The cases were referred to a tribunal. The appointed Judge issued instructions seeking skeletal arguments, in an effort to restrict the time necessary to hear all four appeals. It was agreed between the parties a “lead case” approach would be adopted and the outcome should be applied to all four cases. The Council appointed barrister promptly conceded the substantive point, i.e., each of the four claimants satisfied the regulation above. However, as a fall-back suggested the case should be refused on the basis it represented an “abuse of the HB scheme”. I argued in the alternative, the LHA scheme, because of its “control mechanisms” (role of rent officer, BRMA, 30th percentile) ensured LHA was payable at only relatively modest rates and the council was wrong in its attempts to restrict on the basis of selective adverts, supposedly relating to “similar” properties in the area. It was the VOA that determined the LHA rate.
The Judge determined “The tribunal find its permissible for landlords so to organise their affairs that they maximise the amounts payable by way of HB, provided they do so in a way that does not take advantage of the scheme; and that a landlord does not take advantage of the scheme by an individual decision to let to a particular claimant because that would produce the highest return or setting up business to provide accommodation or support to vulnerable claimants.
The Judge went on to say “it is not the function of Regulation 9 (1) to impede the proper function or operation of the private rented housing sector”.
The outcome will mean around £20K to the landlord in question.
I explain how to approach these type of issues, in much more detail on the RLAs “LHA” courses http://www.rla.org.uk/landlord/courses/l…ance.shtml
I also do intensive 1-2-1 sessions with landlords/agents who are anxious to maximise their yields from maximising HB rates.”