Homelessness Reduction – Four Simple Ideas

Homelessness Reduction – Four Simple Ideas

11:03 AM, 19th October 2018, About 5 years ago 12

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This is an article that I recently published on my Linked In page – Homelessness Reduction: PRS co-operation

Homelessness, and severe housing need, is on the increase, there is a huge shortage of social housing, and no matter how much the Government say they are investing (even if you believe the figures), they cannot keep up with demand. Isn’t it time that Government (national and local) stopped deriding and demonising private landlords, and instead encouraged and embraced them? Close co-operation with small scale private landlords (not just the corporate Build to Rent schemes) has many benefits and can provide some solutions to the housing crisis.

I am a private landlord, I am a private tenant, I am the Director of a not-for-profit housing association http://www.choicehousingltd.org/ , and I have worked in local government housing departments, and also in Citizens Advice Bureaux, so my logic, ideas, innovation, come from my experiences from all of these diverse perspectives.

Mortgage Rescue:

In 2005, three years before the collapse of the housing market which resulted in large scale mortgage repossessions, I drafted a “mortgage rescue scheme” that was simple, workable, and cost neutral, because it involved the co-operation of councils, housing associations, AND private landlords, and it had the potential to have prevented much of the subsequent homelessness that occurred in 2008/09 when the housing market crashed. Unfortunately, the council I worked in at the time rejected the idea, as homelessness due to mortgage repossession was not a major cause of homelessness back in 2005 (and I was no longer working in local authorities in 2008/09). – This is all history now, but it is an example of how simple low cost solutions can be found, when councils and private landlords (including HAs) are willing to work creatively together for the mutual benefit of all parties (particularly the tenants).

Long-term Tenancies:

There has recently been much talk about the possible introduction of 3 year tenancies, but not only are these unworkable (mortgage companies won’t accept them, insurance companies won’t accept them, and they disadvantage landlords) but they are also unnecessary, as the tenants could have the security and confidence of a long term occupancy by use of a Deed of Assurance (proposed several years ago by Mark Alexander of Property118.com). This is the Private Rented Sector (PRS) proposing housing solutions which are sensible, workable, for the benefit of the tenant, but also protecting the landlord’s position, and which cost the councils/government nothing!! – Why does government reject this?

Letting to People on Benefits:

How about the problem of the PRS not letting properties to tenants in receipt of Housing Benefit, again, there are low cost solutions for this, IF councils and government are willing to work with private landlords, for example, councils could act as rent/damage guarantors for tenants, or they could pay for Rent/Damage Guarantee Insurance. While this does have a cost, it is far less than the cost of processing and dealing with the tenants’ homelessness, it benefits the tenants as it gives them access to suitable housing, and it benefits the councils as it relieves the pressures on the housing waiting lists.

Encouraging Responsibility:

Government could amend the legislation that allows direct deductions from a person’s benefits so as to enable former tenant rent arrears to be paid to the claimant’s former landlord. This already happens for some utilities, and past benefit overpayments, so the core legislation already exists, so it would not be difficult to simply insert “former landlord” as one of the people that direct deductions can be paid to (“for former tenancy debt”). This would also have the result of reducing anti-social behaviour, (saving Police time and resources), as it would hold the tenant more financially accountable for their anti-social behaviour. This would save the government money on policing, courts, and other services. It would also encourage responsible tenant behaviour which in turn would reduce the need for evictions, and thus reduce the incidence of homelessness, so it benefits good tenants, good landlords, councils, and central government.

So that is possible solutions for:
1. mortgage re-possession cases (preventing homelessness),
2. insecurity of tenure within the PRS,
3. access to PRS housing for Housing Benefit (or low income) tenants,
4. holding rogue tenants accountable, while also reducing the burden on police, courts, and other services.

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John Frith

14:44 PM, 19th October 2018, About 5 years ago

Good grief, so there are some practical solutions around!
Another one I suggested ages ago was for Insurance Companies to provide Rent and Damage guarantee Insurance at the tenant's expense. The Insurance Companies, who would keep track of claims, (just as they currently do with Car Insurance), would tailor premiums to risk, which would expose serial offenders, and reward good tenants.

Old Mrs Landlord

17:26 PM, 19th October 2018, About 5 years ago

None of these suggestions will be taken up - they are far too sensible and involve a degree of personal accountability on the part of tenants.

Mick Roberts

12:59 PM, 20th October 2018, About 5 years ago

That would make loads of tenants think more wun't it Rob, making the tenant pay back rent arrears from their benefits.
I've told UC DWP this for years, u don't think the tenant is responsible enough to pay their water bill direct, so u deduct that from their benefit, yet you happy to give them £500 for what should the Landlords rent money.

And it would make the tenant think more next time, as u say encourage responsible behaviour.

Luke P

13:11 PM, 20th October 2018, About 5 years ago

Reply to the comment left by Mick Roberts at 20/10/2018 - 12:59
Many tenants in my town would run themselves out of income the number of times they move with arrears. Then the bleeding heart brigade would come along…

Rob Crawford

13:16 PM, 20th October 2018, About 5 years ago

Seems some sensible thoughts. I would add to the "Letting to People on Benefits", "the removal of claw back of paid rent policy" where landlords are required to refund the council if benefits have been calculated incorrectly or fraudulently by the tenant.

Mick Roberts

16:00 PM, 20th October 2018, About 5 years ago

Reply to the comment left by Luke P at 20/10/2018 - 13:11
Yes Luke,
We know the answers us dealing with them & the arrears, but no one comes & asks us what would solve it.

Robert M

23:28 PM, 20th October 2018, About 5 years ago

Reply to the comment left by John Frith at 19/10/2018 - 14:44
Hi John

Yes, I've thought of this in the past as well, but the insurance companies only want to offer Rent Guarantee Insurance to landlords (landlord pays), and even then it is only for the tenants who the insurers consider to be low risk, i.e. those who are in well paid employment. Unfortunately, this does not assist those tenants on low incomes or in receipt of benefits.

There are occasionally schemes to help provide a deposit guarantee, i.e. a paper bond, but these vary massively from one area to another, both in terms of availability, and also in the level of protection they provide to the landlord. In many cases they are simply not available.

I am currently working on an idea for a deposit guarantee scheme, that would be available to all tenants, (at almost zero cost to landlords), and hope to post the idea on Property118 soon, to test whether it would be something that landlords would want.

Robert M

23:32 PM, 20th October 2018, About 5 years ago

Reply to the comment left by Old Mrs Landlord at 19/10/2018 - 17:26
Hi Old Mrs Landlord

I fear you are right, none will be taken up by the powers that be, but at least the practical solutions are now stated on a public forum, and if any government department or organisation wants further details so as to assess the feasibility, then they are welcome to contact me.

Robert M

23:41 PM, 20th October 2018, About 5 years ago

Reply to the comment left by Mick Roberts at 20/10/2018 - 12:59
Hi Mick

There is already legislation that allows direct deductions (third party payments) from a claimant's welfare benefits for existing tenants, for payment of rent arrears (and some service charges), but this stops when the tenant moves out (even though the rent arrears continue to be owed). There is also legislation that allows direct deductions (third party payments) from a claimant's benefits for some utility debts, e.g. gas, electricity, water, so it would be an extremely simple amendment to add in "former tenancy rent arrears" as one of the debts that the DWP can make deductions for.

Yes, if the tenant knew that each time they failed to pay the rent, or they smashed up a property, this would result in a reduction in their welfare benefits until such time as the debt was repaid, then they would definitely start to take more care of the properties, deal with their housing benefit claims, and ensure that the rents were paid.

Mick Roberts

16:09 PM, 21st October 2018, About 5 years ago

Yeah you've said that before Rob.

But to make 'em paying when they move would be a good 'un. In fact, it shun't be good, it should be standard procedure.

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