Universal Credit is here !

by Readers Question

9:18 AM, 28th May 2015
About 4 years ago

Universal Credit is here !

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Universal Credit is here !

I went to a Landlords Forum in Bridgend, Wales last week, what a nightmare! It is finally arriving, the dreaded Universal Credit!

This is where our tenants will receive the housing element of around £500 plus every month. Will they pay us?

Here is my idea to canvass. If you have Housing Benefit tenants they all fill in forms stating “if you do not tell us about any changes in circumstance we will prosecute you”. Now this means HB dept will prosecute for any change right. So…if the HB element of Universal Credit is not paid forward to the Landlord, then why can’t that be a change of circumstance? (The circumstance being that the UC paid forward by Gov’t is paid forward for that housing element).

I am lobbying my local MPs on this. I won’t accept any more rent voids, for if landlords like me go down, then any prospective tenant loses a chance with a good landlord. The very threat of prosecution under Universal Credit housing benefit element not being paid might just stop the tenant thinking they can get away with it.

Any thoughts fellow landlords??

Kevstop



Comments

Anthony Endsor

11:53 AM, 28th May 2015
About 4 years ago

Surprise surprise, another kick in the wotsits for Landlords courtesy of HB tenants.
Why does any landlord bother with them?

Gary Nock

16:28 PM, 28th May 2015
About 4 years ago

Anthony I don't see the attraction with HB / UC tenants. Some landlords build their business on them. Me I just can't deal with
the local authority bureaucracy and tenants who think landlords are a charity.

Rod

20:47 PM, 28th May 2015
About 4 years ago

I've been there, done it, regretted it, don't go there anymore, now several £1000s lighter, but I look on the bright side as the tenants two fingers are now worn right down!

Jonathan Clarke

2:34 AM, 29th May 2015
About 4 years ago

Reply to the comment left by "Gary Nock" at "28/05/2015 - 16:28":

I`m into LHA. The reasons are multi layered but when I started investing in 1999 my profits were roughly 100% more than they were in the traditional BTL in areas which attracted working tenants. So I would buy an ex local authority property for 75k and get the same rate for an LHA tenant as i would in a posher property bought for 150K. The business case was very attractive

Tenant selection is key. There is a common misconception that stereotypes LHA tenants as being somehow a separate breed. Its so misleading of course as we are all 24hrs away from being given a P45 and becoming LHA or an LHA tenant is 24hrs away from getting a job. Their personality doesn`t change overnight if this happens. They are the same person.

As for dealing with the council. Yes a pain on occasions. I get all mine paid direct and the council have deep pockets they always pay in the end if the rent is due.
And for saving 75K on each investment I`m happy to do a bit of extra paperwork.

As for UC. I will use the local voluntary Credit Union. They take the UC and give me my share for a nominal management cost pcm.
.

Peter Poupard

8:06 AM, 29th May 2015
About 4 years ago

I agree with Jonathan, I have one LHA tenant who is a dream.she was a tenant when I bought the property and is no trouble. I have another who came via an agent and has been a problem paying the rent on time since she moved in. She is, and I suspect always has been, on LHA and the rent has regularly been late. It is always paid within 4 weeks of being in arrears or she would have been evicted long ago. I'm in the process of evicting her now as I've had enough, but the problem has always been with her payments being held up for one reason or another. Being on benefits does not make one a bad tenant, I know of individuals who are very capable of fending for themselves who are dreadful tenants.

Rod

12:01 PM, 29th May 2015
About 4 years ago

A good LHA is a rare breed. The last one I had knew every trick in the book and more but then he had a life's experience at it and cost me a fortune! Yes, a P45 can only be a step away and all I have to say is avoid the "professionals". Since the councils have had their budgets slashed they have become very ------- and now won't even answer the phone as they "want you to be naughty" so they can then slap you with a nice big fat juicy £20000 fine! Yes, I've become very cynical and with good reason!

Luke P

12:33 PM, 29th May 2015
About 4 years ago

I'm curious as to what people's opinions are on what should be done with an LHA tenant that builds up an arrears due to not handing over their benefit to the landlord? This is public money that is given to tenants for their housing, not for anything else.

A roof over your head is the most important thing in life and the foundation of independent living, so why on earth is this money risked going anywhere but to the landlord?

My question is one of morality rather than practicality (I have no trouble ensuring I am paid all my rents all of the time).

Personally, I think it is tantamount to theft.

Gary Nock

12:49 PM, 29th May 2015
About 4 years ago

Reply to the comment left by "Luke P" at "29/05/2015 - 12:33":

Luke, essentially, and unfortunately, some LHA tenants have very different standards of morality and sense of right and wrong. To them, the "rent money" is theirs to be spent as they see fit - on 55" plasma TVs, Carlsberg Extra Strength Lager, Drugs, the latest Iphone - in fact anything but the rent.

In 30 years of policing some of the most deprived areas in the UK, and travelling and inspecting police forces across the country, the names change but the story is always the same.

They do not give one iota about the landlord, his financial position etc. They see you as a resource to be used and abused as they do to everyone and everything else in their lives including themselves.

But - not all LHA/HB/UC tenants are the same. There are those that choose to feed their kids before they pay the rent - which is a difficult position for anyone to be in. For those I have an enormous amount of empathy. But for those who sow the seeds of their own downfall and reap the "rewards" of it - I have no empathy whatsoever.

Being a landlord is a business. We do it not because of some sense of moral provision of housing for the less well off . We do it to make a profit. End of. Risk variables such as LHA/HB/UC tenants increase that risk and interfere with the business.

If they get in arrears - evict. And see how "supportive" the LA are to the landlord. They tell the tenant how to stay in the property at YOUR expense.

Does that answer the question?

Anthony Endsor

13:11 PM, 29th May 2015
About 4 years ago

Yes Gary, and it also answers the question as to why I won't touch HB/UC tenants.
They are a disaster waiting to happen, and even the ones that seem good whilst living in the property could very well do the 'stay and wait for the bailiffs to come' routine when you try to evict them. It's about time legislation was passed to stop all this.
Make it so that ALL HB tenants' rent gets paid directly to the landlord from the Council, and make it a criminal offence for a Council to behave in a manner which would detriment the landlord at the end of a tenancy.
By the time this happens though, hell will have frozen over to the point where the dead will be living in our houses.

Rod

20:31 PM, 29th May 2015
About 4 years ago

Reply to the comment left by "Anthony Endsor" at "29/05/2015 - 13:11":

It's my cynical view that rent is given to LHAs knowing full well that rent is seldom paid on therefore more money in LHAs pocket which helps shut them up with the L/L seen as able to afford the 'hit'. I'll be shot one day!

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