Lowered Benefit cap could affect landlords from 8th May?

Lowered Benefit cap could affect landlords from 8th May?

11:04 AM, 13th April 2015, About 7 years ago 159

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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.

Mick Robertsbenefit cap



Comments

by Robert Mellors

12:13 PM, 17th May 2015, About 7 years ago

Reply to the comment left by "Luke P" at "17/05/2015 - 10:15":

Hi Luke P

Not sure who's comment you are responding to, so can only answer from my own perspective:

I already make it a condition of tenancy, but it does not help in the following situations:
if tenant gets sanctioned;
if there is a rent top up to pay (rent higher than HB rate);
if there is a service charge to pay (e.g. for utility bills);
if tenant has a HB overpayment at a former address (as this is deducted from their ongoing claim at the new address);
if tenant's circumstances change (or keep changing, e.g. zero hour contracts);
if tenant fails to provide the information (evidence) requested by HB Dept;
if tenant causes damage to the property;
if tenant causes problems with other residents/neighbours;
if tenant committing crime and police smash door in;

All of these things (and many many more) are risks on the landlord, and will cost the landlord money to put right (e.g. evicting the tenant and doing repairs etc), so although we can pass on the cost to the tenant in theory, there is no real enforcement option available (that's effective), so this is why I suggest that landlords need to be able to evict problem tenants much faster, and why there needs to be deduction from benefits as a debt enforcement option.

by Mick Roberts

8:12 AM, 18th May 2015, About 7 years ago

Landlord is the vulnerable one, very true.
Tenants causes all the damage, spends the rent, rings the authorities, Landlord is frowned upon.

by Luke P

10:08 AM, 18th May 2015, About 7 years ago

Almost everyone on here agrees that the system is very much broken and that landlords are the ones left very exposed, yet we seem split on whether to withdraw support or give more.

I would actually be in favour of more support if we could afford to pay for it (and fix the system in the process), but that is where I see the differences in opinion lie. We can't afford it and so surely logical conclusion would mean that withdrawing support is now the preferred option to try, no? Rather than half giving support, which gets society very little in the long run AND it costs.

by Robert Mellors

20:38 PM, 19th May 2015, About 7 years ago

Reply to the comment left by "Luke P" at "18/05/2015 - 10:08":

But withdrawing support means some very vulnerable people will die, and many more will be made homeless and destitute. What you are suggesting would harm hundreds of thousands of people, including innocent children. It would be tantamount to extermination of the poor. - Your "logical conclusion" is morally indefensible, I can only assume that you have not thought it through, because if you had fully considered the consequences of your suggestion then I hope that you would not come up with such a suggestion!!!!!!

by Alan Loughlin

20:42 PM, 19th May 2015, About 7 years ago

tenants moving into areas of lower rent will not kill anyone.

by Jay James

20:45 PM, 19th May 2015, About 7 years ago

The UK hasn't got the money to carry on current spending levels.
It has to cut somewhere.
Benefits are roughly one third of national expenditure.

Whether or not benefits are cut, there are no options that are anything less than very harsh.

by Robert Mellors

20:45 PM, 19th May 2015, About 7 years ago

Reply to the comment left by "Alan Loughlin" at "19/05/2015 - 20:42":

Luke's "logical conclusion" in his comment above was to stop providing support, i.e. welfare benefits.

by Luke P

20:50 PM, 19th May 2015, About 7 years ago

Robert, what do you suggest? Just keep treading water, barely staying afloat by just keeping things as they are? I doubt anyone will die, but even so -and I know this is tough to hear- but it might just be that some peoples' lives get worse in order for the future to be better for all. Standing still is no longer an option. Stop trying to battle my position and propose a viable alternative.

by Robert Mellors

21:05 PM, 19th May 2015, About 7 years ago

Reply to the comment left by "Luke P" at "19/05/2015 - 20:50":

I've already made a few suggestions for changes that could improve the situation, but it is tweaking at the edge of a flawed system rather than proposing a complete new system i.e. the "viable alternative" that you want. However, the fact that I cannot propose a system that will solve the financial crisis of the country for the next 50 years does not mean I have to agree with your particular proposal to end supporting people. Sorry if you think I am battling your position, it's not a personal attack, I just strongly believe that the idea you suggested would have some dire consequences for hundreds of thousands of innocent people, and I believe such an idea is wrong.

If welfare benefit support is withdrawn, then some families cannot feed their kids, so kids will die. It's a simple equation: no money = no food = death.

Yes, it may be tough for me to hear, but it will be tougher for the children of the poor to hear when you tell them they can live on the streets or die so that the "future can be better for all" (except them of course).

by Alan Loughlin

21:11 PM, 19th May 2015, About 7 years ago

i have seen this "we have no money for food" on the TV many times, strange how they seem always to have a fag in one hand and a can of beer in the other, and a huge dog at their side. People do not die of hunger here, it is just a question of priorities.
The country is sick of hearing liberal views, and the abuse that this entails, hence the trouncing of the lib dems at the elections.

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