Quote of the day...on renting to housing benefit tenants

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It's always good to read something considered on a subject that caused much froth and bother in the media. It's from the always readable and helpful (I know, I know, she's a lawyer) Tessa Shepperson at the Landlord Law Blog:

The whole question of housing those on benefit is a tricky one. Although there are many, many excellent tenants on benefit, overall they tend to be more problematic:

• They have less income than most working tenants and so finding money to pay rent is inevitably going to be harder

• The housing benefit received is generally less than the market rent – so either the landlord has to accept a lower rent (and why should they do that?) or the tenant has to make up the difference – which will not be easy for them

• Rent is not paid direct to landlords by the benefit authorities in most cases

• Benefit Offices are not known for their efficiency and landlords often have long waits before payment is received

• Benefit tenants as a group contains more people with some sort of personal problem – these are after all people who are unable to get or hold down a job

• It appears that rent guarantee insurance is not available

For an example of a well meaning landlord renting to a single Mum on benefit, coming unstuck look no further than Kate’s Story on this blog.

Tessa goes on to remind us that the private landlord has no duty to house the homeless or people on benefits but also to make some sensible suggestions including:

If a landlord is willing to rent without rent guarantee insurance, there are things that can be done.

Insisting that tenants have their benefit paid to a Credit Union which offers ‘jam jar’ accounts is one, or using the Tasker Payment service is one.

It is arguable that this is a better option than having benefit paid direct to the landlord, as then the benefit office is unable to ‘clawback’ the benefit from the landlord if it later turns out that there has been an over payment.

A good blog on a subject more characterised by screams about landlords being evil than anything that might actually help house the homeless. Plus Tessa finishes with something we all know:

Another reason why the government needs to start building.

Although I would add "in London and the South East" - a point well made in the comments to the blog.

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An interesting point about the licensing of private landlords:

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An idea that is (sort of) national policy for the Labour Party. Here's Ben Reeve-Lewis (not exactly a natural pal of rapacious private rental sector (PRS) landlords):

...if you go down the strict, blanket licensing route, you can forget building a partnership approach with the PRS community.

Whereas the social lettings agency route is based on building bridges and understanding, the licensing approach is a blunt tool that I would argue damages more than it helps...

Councils need PRS landlords more than they need councils and to entice them over we need to offer a hell of a package that will work for the PRS community.  And in the working of it, councils will find it easier to police what is going on.

Ben goes on to say that the selective licensing approach (which we have - to Bradford's leadership's credit - twice voted down at full council) damages the relationship between the PRS and Councils to the detriment of the market and one assumes the tenants.

Ben concludes by despairing at the killing off of partnership approaches to lettings and the impact of the licensing approach championed by Newham Council:

The damage caused to schemes that are trying to build bridges and work with the PRS carries further than the borough boundaries of Newham and confirms endemic fears of many in the landlord community that councils are simply looking on the PRS as a huge cash cow.

Battle lines are beginning to get drawn and personally, I predict a civil war between town halls and the PRS if blanket licensing becomes the idea virus that it is threatening to become.

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