News from the Residential Property Investor, the bi-monthly magazine for RLA members other artilces from the October / November 2000 issue RPI news archive

Death of housing Benefit - October / November 2000

Landlords are no longer investing in property to let to tenants on housing benefit. Where there is no alternative to housing benefit, landlords are selling and leaving the market. Over 300,000 private sector lets to tenants on housing benefit have disappeared over the last three years.

Where there is a rent shortfall due to Rent Officer involvement, landlords are increasingly serving possession notices. In one area that has both SRB and New Deal status, all the agents have withdrawn from housing benefit lets. Financial institutions have all but pulled the plug on housing benefit tenancies.

The reasoning is simple. Housing benefit rents are uneconomic rents. The poor administration of housing benefit is a national scandal with extremely late and wrong payments. And the procedures are unfathomable even to housing benefit staff.

The verification procedure is the final nail in the coffin as it makes housing benefit all but impossible to administer - and even more draconian rule changes are in the pipeline.

The Government needs to take note as this has major implications for affordable housing and government finances. The official opposition has proposed paying the rent direct to the tenant, which would be even more disastrous for those landlords locked into housing benefit lets. If private landlords are to be encouraged to come back into this market they will need guaranteed economic rents and assurances of unbiased professional administration.

Martin J Moylan
 

other artilces from the October / November 2000 issue

• Death of housing Benefit
• Data services cause personal problems
• In brief
• Home ownership to continue rise