Theresa May announces the scrapping of the housing benefit cap for supported housing and the wider social housing sector
The Prime Minister announced today that the government will be scrapping the Local housing allowance (LHA) cap on supported housing.
This is significant news for housing providers, developers and residents. Today’s announcement means that changes to benefits for people living in social housing, which have been controversial, will no longer apply. This is good news for thousands of elderly and vulnerable people living in supported accommodation.
Theresa May's announcement also highlighted that the LHA cap would be dropped for the wider social housing rented sector which is a huge relief for many residents, particularly young people which would have been priced out of social housing.
What are the likely implications?
While we wait for further announcements and concrete details to emerge, it is likely that:
- housing providers will have more certainty over their funding of supported housing schemes, especially in relation to making further development a viable option;
- housing providers will once again be able to work with developers to build more specialist supported housing;
- vulnerable residents with care and support needs will be able to be housed in suitable supported accommodation.
This is an important victory for the sector as many residents, housing providers and membership organisations have lobbied government for the past two years urging them to rethink their proposal. It appears as though the sustained lobbying has made an impact, although the detail is yet to emerge.
This is a boost to the sector in general and comes shortly after the announcement on the new rent settlement of CPI plus 1% from 2020 which provides more certainty for the development of new homes.
The government will be publishing their response to the consultation on Tuesday 31 October and this will provide more detail on a new funding framework. Landlords will now need to make up for lost time in shelved developments and examine proposals once again.
How can Capsticks help?
We would be delighted to assist you with your discussions and development proposals following this announcement. Capsticks has grown its development team significantly and has the expertise to make your development a success.
Our Housing Advisory Service complements the work of our legal expertise and can also assist landlords with their strategic planning and operational delivery.
For more information and an informal chat, please contact our Head of Housing Advisory Service, Chris Grose or our Head of Development, Chimi Shakohoxha.