15% of private landlords say they will stop offering Local Housing Allowance (LHA) tenancies in response to the government’s changes to the way LHA scheme payments are now being calculated according to BDRC Continental’s Landlords Panel research.

The research indicates that changes to LHA payments - applied since 1st April 2011 - will have a significant impact upon private landlords operating in the sector. Key changes to the LHA scheme include capping the maximum LHA rates and reducing the maximum property size allowance from five bedrooms to four.

As a result, one in four private landlords are saying that they have already begun to look at ways to reduce the number of LHA tenants in their portfolios, and a higher proportion (32%) will do so when capping affects their lettings. Half of the landlords surveyed claim they will be less likely to accommodate LHA claimants as tenants in the future.

Commenting on the Landlords Panel findings, Mark Long, Business Propositions Director for BDRC Continental says: “The predicted demand for privately rented accommodation has risen since the first quarter of 2011, with LHA claimants accounting for 35 per cent of tenants in the sector.
However, the proportion of LHA claimants has already dropped by four per cent since the first quarter of 2011 and a significant number of private landlords are saying they will respond to the capping of the LHA scheme payments by withdrawing from that sector of the private rental market. It will be interesting to track the impact of LHA capping as it plays out across the private rental sector.”