Benefit Tenants Set To Miss Out On Private Rented Homes

Housing benefit tenants are set to lose out on private rented homes as landlords look to tenants less prone to missing rental payments, in order to minimise the impact of last year’s Budget. According to the latest research from the National Landlords Association (NLA), 60 per cent of landlords report that the Chancellor’s decision to remove mortgage interest relief from 2017 will reduce their profitability. In order to recover costs, 20 per cent of those landlords say they will need to prioritise other tenant types over those perceived to be ‘riskier’ – such as tenants in receipt of housing benefit. In the last year, two thirds (64 per cent) of landlords with tenants in receipt of housing benefit experienced rent arrears. Furthermore, over the past four years, the proportion of landlords who let to tenants in receipt of housing benefit has almost halved, with the trend looking certain to continue. Read more on the NLA website.

Great Council House Sell-Off Scandal

Council houses are being sold off on the cheap to people who immediately rent them back to housing benefit tenants. Councils are selling off their already‑limited supplies of housing stock and allowing former council tenants to profiteer as buy-to-let landlords. That is forcing local authorities to pay more to place deprived families in properties that used to be council-owned. At least 32 councils now rent or pay out housing benefit to tenants living in homes sold since the Government revamped the Right to Buy scheme in 2012. There are rules to deter the immediate sale of properties bought under Right to Buy but renting is unregulated, so the Government’s hefty discounts on sales have turned former council tenants into buy-to-let landlords overnight. Council leaders have branded the situation a “national scandal”. Read more on the Independent website.

Why Landlords Are Shunning Profitable Benefit Tenants

Britain’s army of 1.4million private landlords are upbeat about 2014, expecting further price rises and rent increases. But in what is a growing political controversy – and a logistical nightmare for local authorities needing to house residents – private landlords are increasingly refusing to let property to tenants on benefits. Mortgage lenders and insurers are also growing wary. According to the National Landlords’ Association (NLA), the biggest organisation representing buy-to-let investors, the proportion of landlords prepared to accept tenants receiving LHA has more than halved in three years. In mid-2010, 46pc of the NLA’s members let to tenants who received the benefit. By late last year this had dropped to 22pc, with the NLA commenting that the “decline steepened during 2013”. Read more on the Daily Telegraph website.