Table of Housing Benefit cuts from Nov 2016

Table of Housing Benefit cuts from Nov 2016

10:55 AM, 12th September 2016, About 5 years ago 22

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Like many landlords on this forum, I let properties to tenants in receipt of Housing Benefit. I usually get the HB paid direct to me as not all tenants would use it to pay their rent.cuts

I have recently read that the Benefit Cap is being reduced in November 2016, and as the Housing Benefit (or “Housing Costs” element of Universal Credit) is the portion of overall welfare benefits that will be cut first, I thought a summary of the likely cuts would be useful.

Another website I get e-mails from (though mainly dealing with social housing issues) very helpfully gave a table that gives this information, and the cuts are going to be massive. e.g. a two parent family with three children will get a maximum of £50 per week Housing Benefit (£108 pw in London), leaving them to find the rest of their rent from their Income Support or Jobseekers Allowance.

Clearly, a great many families are not going to be able to top up their rent sufficiently, and will get into rent arrears and eventually be evicted. If landlords have tenants who claim Housing Benefit (or Universal Credit) then they really need to see this table of maximum Housing Benefit. It is a bit big to replicate on here, but if anyone would like me to e-mail them a copy please let me know.

Robert



Comments

by Robert Mellors

19:30 PM, 12th September 2016, About 5 years ago

Reply to the comment left by "Julie Dawson" at "12/09/2016 - 18:38":

Hi Julie

The table I am e-mailing to people (or found on the website link I posted on here) shows the maximum HB for the different household compositions, for the two areas: London, and everywhere else in England (which includes the North East). No drop down boxes are needed.

by Rod

23:35 PM, 12th September 2016, About 5 years ago

Interesting artical/comments. I go by personal experience. I've had several DSS tenants over the years and ALL were trouble with the last crowd costing me £2,500! NEVER, will I have DSS again, one 'gentleman' hasn't worked for 35 years with no intention of starting now and seems to suffer one ailment after another, poor thing! I'm with the government.

by MoodyMolls

17:16 PM, 13th September 2016, About 5 years ago

36% of social housing is financially toxic
May 10, 201596 views8 Likes2 CommentsShare on LinkedInShare on FacebookShare on Twitter
The Conservative benefit cap policy makes 36% of social housing financially toxic as it means that a fully occupied 3 bed or larger property is not affordable to any social tenant in receipt of benefit.

The couple with 3 children will have their housing benefit cut under the policy and will have to find at least £30 per week to top up the rent and that figure is based on a social rent property. The benefit cap, or more correctly labelled the overall HOUSING benefit cap (OHBC) makes affordable rent, the AR model, as dead as a dodo.

For social landlords it means that they cannot afford the financial risk of accommodating any household with 3 or more children and from just 6 weeks or so's time when the reduced OHBC will take full effect.

The cap reduction to £440pw in London means the couple with 3 children can receive a maximum HB of £106.23 per week. In the regions with a lower cap of £400pw they will receive a maximum of £63.52 in housing benefit. Wherever they live they are entitled to at least a 3 bed property which now becomes toxic financially or unaffordable for tenant and landlord.

This £30 or so top up is double the average bedroom tax top up and the affordability issue / financial risk of arrears issue is stark in that comparison.

It gets worse as the 1 parent 4 child household needs to find £55 per week top up or almost 4 times the bedroom tax top up and the couple with 4 children will not get a penny in housing benefit in the regions and have to pay full rent out of their welfare benefit.

The situation for private landlords is worse as their rent levels are higher and so existing PRS households with children will be evicted en masse as the private landlord is far more risk averse and has no option but to issue Section 21 Notices like confetti to existing tenants. This will happen especially in low rent areas when the 1 bed LHA rate quite often covers a 3 bed PRS rent and so the OHBC perversely incentivises the private landlord to deliberately under occupy property with the benefit tenant.

Yet those mass PRS evictions mean local councils will be banging on the door of social landlords to rehouse these homeless families for which the council has absolute duty to rehouse and are costing a fortune in housing benefit in B&Bs and other temporary accommodation....and social landlords will be forced to say sorry we cannot help you as the financial risk is too great.

I have put out plenty of posts about the OHBC and the figures above are confirmed by all the social landlords I have spoken with and those who have contacted me to discuss some of the solutions I have developed to these issues.

So the above is not speculative or does it contain hyperbole as to the fact that the 3 bed and larger sized social housing property is a financially toxic one. The EHS figures are that 35.7% of all social housing stock is 3 bed+ and many social landlords have far higher percentages than that; indeed many LSVTs have greater than 50% of all stock now being financially toxic due to the Tories reduced OHBC policy and 24 out of the top 25 with the highest percentage are LSVTs now managing the former council housing stock.

Yet the stock profile is only one of the financial risks and the OHBC fundamentally affects all strategic and operational activities on top of financial ones for all social landlords whether council, HA, ALMO or any other type.

While the 'sector' ONLY focuses upon right to buy for HAs - which will have far lower impact than this OHBC policy - the days tick by until this reduced benefit cap policy becomes fully operational and boy are those social landlords going to be in a a huge financial shock come July and then will have to deal with the issues of just how do we evict children as the OHBC directly targets and puts at risk families with children - a very different question to evicting largely single people which the bedroom tax targets.

The OHBC is a far higher and far greater financial risk to social landlords than the bedroom tax and social landlords need to wake up and smell the coffee

by Robert Mellors

19:38 PM, 13th September 2016, About 5 years ago

Reply to the comment left by "KATHY MILLER" at "13/09/2016 - 17:16":

Hi Kathy

I'm not sure why you have copied and pasted this article about social housing, as it is not directly relevant to private landlords, it merely confirms that the Benefit Cap will affect many social housing tenants (council and housing association tenants) as well as tenants of private landlords.

by MoodyMolls

19:50 PM, 13th September 2016, About 5 years ago

Hi Robert

Section24 will result in many not taking LHA and it looks like Social Housing will also not be taking some families so the homelessness will be massive.

by Robert Mellors

19:57 PM, 13th September 2016, About 5 years ago

Reply to the comment left by "KATHY MILLER" at "13/09/2016 - 19:50":

Hi Kathy

It is the Benefit Cap that will stop landlords housing large families, not section 24 (that will just push up the rents and put some landlords out of business), but I agree entirely about the increased homelessness, so it begs the question, who will house the unfortunate families affected by this? Will families be forced to split so that their households are smaller and they can thus be housed (but in two houses instead of one)? It is far too simplistic to say that they should all go and get a job and thus be exempt from the Benefit Cap, (though employment and self-employment may be an option for some).

by MoodyMolls

20:10 PM, 13th September 2016, About 5 years ago

My council housing team are already advising the families to split up to avoid the cuts. How much more will that cost?

I have to stop taking LHA because I need to increase rates due to Section24 I normally do not increase rents during term of tenancy average 5 years.

It would appear that the funding to hostels have also been drastically reduced so these may close.
I too would love to know where the government intend to put all these families with children .

You have these cuts now then 2020 section 24 fully in

This is what somebody wrote

Finally, the LHA maxima policy was announced out of the blue in the Autumn Statement on 25 November 2015 and was accompanied by the OBR estimates of savings which also included the certainty level of achieving the stated policy aims.

The OBR said the LHA maxima had a medium to high level of UNCERTAINTY in achieving its aims and its projected savings!

This policy is a dog with fleas and the government don’t have a Scooby Doo what they are doing. Abandon the policy

I think the costs of these policies will be in orbit I bet they dont publish the correct figures

by MoodyMolls

20:20 PM, 13th September 2016, About 5 years ago

I think they will get a company to house all benefit people . This company will be paid 3 x the rate of benefits currently given out and it will be paid direct.
I suspect very little tax will be paid in this country

They will house them anywhere in the country probably the cheapest areas to max their profit.

Social housing will have large families crammed into 1 bed properties. They will probablystart knocking all the walls down in a 3 bed to turn it into a one bed because they cannot let the 3 beds to LHA

by Robert Mellors

21:05 PM, 13th September 2016, About 5 years ago

Reply to the comment left by "KATHY MILLER" at "13/09/2016 - 20:10":

Hi Kathy

LHA applies to private rented properties, so is relevant to the landlords on this website that let to DSS tenants.

LHA Maxima only applies to social housing, so would only apply to landlords who are registered with the Homes and Communities Agency as providing social housing. This could include housing associations, co-operatives, domestic violence refuges, and supported housing (e.g. hostels, and sheltered housing for the elderly) run by some charities and housing associations. The LHA Maxima policy would not apply to private landlords.

The standard LHA policy imposes restrictions on the Housing Benefit paid to private landlords. The LHA Maxima policy proposes to restrict the Housing Benefit paid to supported housing providers, (even though the cost of providing supported housing is much higher), and this may result in many hostels, refuges, foyers, and other supported housing closing. This will mainly affect single people with disabilities, learning difficulties, mental health problems, and the elderly, i.e. those people who are most vulnerable.

This is "social cleansing" on a grand scale, but it will end up costing the taxpayers 3 or 4 times the current spend on Housing Benefit for these tenants, so I feel that it is false economy predicated on lies and deceit designed to hoodwink the public into supporting the policies.

by MoodyMolls

7:06 AM, 14th September 2016, About 5 years ago

Reply to the comment left by "Robert Mellors" at "13/09/2016 - 21:05":

Thanks for that Robert

But if the social sector cant afford to take all the tenants which landlords have to evict due to S24 then the government homeless figures will be hugh. Councisl will not be able to deal with the numbers coming throu due to cut backs. Its taking 4 hours for tenants to be seen by housing Options now.

So will they employ more staff?


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