Universal Credit – Parliamentary Written Answer

Frank Field: To ask the Secretary of State for Work and Pensions, what proportion of people repaying a universal credit advance are asked to repay within (a) three and (b) six months; how many of those people have other sums deducted from their monthly payment; and in how many of those cases that total deduction exceeds the maximum recommended amount.

Damian Hinds: Claimants choose the periods of repayment. Some 77% of claimants have chosen to repay in 6 months and 8% within 3 months. Deductions for arrears are made in a priority order and can never exceed 40% of the personal allowance.

Top Tory Councillor Wants RTB ‘Re-Think’

A top Tory councillor is calling on Prime Minister Theresa May to ‘re-think the rules’ on Right to Buy – evoking the spirit of Margaret Thatcher. Councillor Rock Feilding-Mellen is the Deputy Leader and Cabinet Member for Housing at the Royal Borough of Kensington and Chelsea. Cllr Feilding-Mellen says it would be better to fund RTB – for council tenants as well as for housing association tenants – by offering shared equity deals so when homes are sold the discount would be repaid to the Exchequer to be recycled to help more people. He says: “An approach along these lines would increase the chance of being able to prevent our cities from becoming polarised between rich and poor areas and preserve mixed communities.” Read more on 24housing.

Regulatory Changes Slowing Buy-To-Let Growth

Paragon Group of Companies said recent fiscal and regulatory changes and proposals may soften the rate of growth for buy-to-let as time progresses, but demand for rental properties would remain strong. Britain will raise the level of property tax for those who buy a house in order to rent it and on second homes, finance minister George Osborne said in November, as part of plans to cut government spending and raise revenues. Additionally, banks across the world would have to set aside more capital to cover buy-to-let mortgages and place greater emphasis on a borrower's ability to repay a home loan, under draft rules from global banking regulators. However, to date, there has been no change in existing buy-to-let customer behaviour, Paragon said. Read more on the Daily Mail website.

Grant Repayable If RTB Replacement Deadline Missed

Housing associations will repay government grant from Right to Buy homes if they fail to replace properties sold in three years, under a sector proposal. Details of the National Housing Federation (NHF) offer to government to escape legislation to implement the Right to Buy reveals measures designed to encourage landlords to replace homes sold under the policy or else face repaying government grant. Under the proposal, all proceeds from the sales would be expected to be spent on building a new home, or in “exceptional” cases buying new property within a maximum of three years. However, only the grant that was originally provided to build the sold home would be returned to the government if it was unspent within the three-year period. Download the proposal from the NHF website.

Rogue Landlords Could Be Forced To Repay Housing Benefit

Landlords could have to re-pay 12 months’ worth of housing benefit if they illegally evict tenants or fail to maintain their properties, under government plans. A government discussion paper says, “An effective enforcement regime is essential to drive up housing standards in the private rented sector and tackle criminal landlords.” The document says ministers are “exploring the scope” for extending ‘rent repayment orders’ – a tool in which a court can order a landlord to repay up to 12 months of rent after an application from a council or tenant. The cash can be retained by the local authority and used for housing purposes where the rent has been paid through housing benefit. Currently, rent repayment orders can only be applied where a landlord has failed to obtain a licence for a licensable property. Download the consultation paper from the CLG website.

Government Cuts Mortgage Support

The amount of money struggling homeowners can claim to help them meet monthly mortgage repayments is to fall in July, after the government cut the interest rate used to make the calculations. Currently homeowners entitled to support for mortgage interest (SMI) can get help with monthly payments on a mortgage worth up to £200,000 based on an interest rate of 3.63%. But following a sharp fall in high-street mortgage rates, the rate will be reduced to 3.12%. SMI is a means-tested benefit that can be claimed by people receiving income-based jobseekers allowance, employment and support allowance and pension credit. It is designed to cover a borrower’s interest payments to their bank or building society, but not the original capital they borrowed. It is currently claimed by 161,000 people. Read more on the This is Money website.

Annual Housing Costs Hit £133 Billion

The total annual cost of housing across England and Wales is approximately £133 billion according to new research from property adviser, Savills. While mortgage interest and repayments make up 49 per cent of the total cost, private rents now account for 36 per cent of the nation’s housing costs. However, there is significant regional variation. In London there are relatively few households who own their own home mortgage free, private rent makes up almost half of the total cost of housing, bringing the average cost per household to £11,329. Meanwhile, in the North East where housing is comparatively less expensive and 24 per cent of the cost of housing is in the form of social rent, the average cost per household is £3,450. Read more on the Savills website.

Lib Dems Set Out a Help to Rent Scheme For Young People

The Liberal Democrats have announced plans to provide government loans for tenancy deposits to help young people to rent their first home. The party’s proposed “help to rent” scheme would allow people aged 18 to 30 to borrow up to £1,500 (£2,000 in London) from the government to use as a deposit on rented accommodation. The loans would be repaid over a period of either 12 or 24 months. The party says many young people are struggling to save deposits to rent without help from family members, forcing them to live with their parents for longer. The average rental deposit in the UK is £1,200, usually six weeks of rent. Read more on the Property Wire website.

Councils May Have To Return HRA Cash

Housing minister Kris Hopkins intervenes after councils use rent money for other purposes. Councils which transferred rent money to support other council services face being forced to return the cash. The CLG has issued a letter to local authorities, calling for information on transfers between the housing revenue account and the general fund.  The department will consider the responses before deciding whether to demand any of the money be repaid to the HRA.  The letter said: ‘The ring-fence of the housing revenue account exists to protect the rents paid by local authority tenants, in order to accurately reflect the cost of their housing service. These funds should therefore not be used to cover the costs of other council services.’ Read more on Inside Housing.