Covid-19 Bounce Back loans for property businesses16:06 PM, 5th May 2020
About 3 weeks ago 46
If nothing is changed post election on the 8th of May the Benefit cap will be reduced from £500 to £440 pw in London with a lower cap in other regions of £396, 90% of the London figure.
As an example: A two parent household with three children receive £334 per week and then deduct the welfare benefit and child tax credit income to leave a maximum residual HB or LHA payable. From the new cap figures this leaves a maximum of £62 per week in housing benefit outside the capital and £106 per week in London.
The question is will landlords risk renting their investments to benefit families who will only receive £275 per calendar month in HB or LHA towards the rent on a three-bed property? Or to a single parent with three children who will only receive £456 per month in HB to pay for a three-bed property in an area such as Liverpool with a typical three-bed private rent of £525 per month?
The last two years has seen some social landlords refuse to tenant a property with those under occupying due to the bedroom tax. Now landlords could face a greater financial risk, even on fully occupied properties, and so some may be forced to stop providing property to such households. Thus creating even greater pressure on council supplied social housing.
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