LANDLORDS…
HAVE YOUR SAY ON HOUSING BENEFIT
The private rented housing sector plays a key role in providing accommodation to those in receipt of benefits and on low incomes because the social housing sector simply does not meet the need in terms of number of properties available, suitable and affordable.
As such, many private residential landlords have tenants who are in receipt of benefits or on low incomes, and some (not usually all) of those tenants’ rent is paid by way of Housing Benefit, or the more recently introduced Local Housing Allowance. If the Housing Benefit payments are coming in regularly and without hitches this can sometimes be a reliable way of getting the rent. However, it can also be fraught with delay, difficulties in communicating with Housing Benefit departments, and complications when tenants do not renew their claims, do not pay their “shortfall” rent, or have frequently changing circumstances such as coming in and out of short-term work.
The Government recognises that the system has flaws and is looking to improve it. In December 2009 the DWP published its Report and Consultation on Housing Benefit which outlines proposals for changes to the Housing Benefit system. The paper invites responses to be submitted by 22nd February 2010 by all interested parties, which includes private landlords and letting agents.
If you are one of the many landlords who has experienced problems in the past with Housing Benefit or Local Housing Allowance, then now is your chance to air your concerns and give your views as to how the system might be improved both for yourselves and consequently for your tenants and for the private rented sector as a whole. Landlords often feel that the balance in these matters tends to swing too much in favour of the tenant so have your say. The more landlords respond to the consultation the more likely it is that their views and interests will be taken into account when changes are being implemented.
The Report and Consultation on Housing Benefit can be accessed at www.dwp.gov.uk/docs/hb-consultation.pdf
The report is some 40 pages, parts of which relate more to the social housing sector. However, some aspects of it are highly relevant to private landlords. Among other things the report discusses the introduction of the new Local Housing Allowance, how that is working, and in particular about the choice it introduced for tenants to have the allowance paid to them rather than directly to their landlords. The report deals with the transition into work for Housing Benefit recipients and how this could be made easier for example by having a longer 3 month transition into work period where the benefit is fixed. The long term vision is to possibly integrate Housing Benefit with other parts of the benefit system and to introduce more flat-rates and to have, for example, fixed 6 month awards without claimants having to report each and every change in their circumstances.
The biggest impact for landlords arising out of the proposals in the report could be the long term aim to help more claimants to receive their Housing Benefit directly rather than for it to be paid to their landlord. In my experience many private landlords would consider this to be a disaster. Whilst giving “choice” to tenants it would increase the costs for them of trying to recover rents and would raise the chances of tenants going into arrears. The “choice” it would give to less responsible or financially stretched tenants would be for them to spend the rent money on other things! In the long run this would not be in the interests of the tenants as there would be more evictions, and increasing numbers of private landlords could choose to reject new tenants who are in receipt of Housing Benefit, thereby reducing the amount of housing available generally to those on low incomes.
The report touches on the green housing agenda by suggesting that the carbon footprint of the private rented sector could be improved by obliging landlords to comply with quality or energy efficiency standards if they want to have the Housing Benefit paid directly to them. This sounds like a change that would involve unwelcome paperwork and bureaucracy for landlords. What other incentive might there be for private landlords to improve the energy efficiency of their properties?
An interesting proposal is that local authorities need to make more use of the private rented sector in order to give more options to those in housing need. It is suggested that local authorities could set up local letting agencies as part of a more coordinated approach with private landlords.
If you have been motivated to read the report and have your say then the report itself at paragraphs 8.1 and 8.3 provides details of how to respond to the DWP either by post or by email.
Tel: 01482 324662
Fax: 01482 860118
e-mail: scoatesmadden@sandersonssolicitors.co.uk
Source: Humber Landlords Association, January 2010