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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Immigration checks in housing - or how to create some more rich criminals

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There are proposals afoot to make landlords check the immigration status of new tenants:

Private landlords will be required to check the immigration status of new tenants under government proposals being launched in a consultation today.

The government also plans to introduce proportionate penalties for those who make a single honest mistake, and much heavier penalties, up to £3,000 per tenant, for rogue landlords who repeatedly and deliberately break the law.

Just as requiring employers to conduct these sort of checks creates a cash-in-hand economy within immigrant communities, expecting the same of landlords will result in this:

‘UKALA (letting agents) is deeply concerned that the Bill’s requirements will further restrict access to housing for people from outside of the UK, or with non-standard requirements. Many areas of the UK have very competitive lettings markets and it is entirely conceivable that landlords will instruct agents to favour those tenants they perceive as ‘low risk’.

So where do those high risk tenants go? Here, from Ben Reeve Lewis is an indication:

A couple of weeks back a landlord came to me with a quandary. He had let his 3 bed, Deptford flat @ £1,600 per month to two guys. They have been there 2 years and never missed a penny in rent, so he doesn’t have a problem.

Total received? £38,400 and very nice too.

He decided to visit the property for a genial chat and catch up with his model tenants, only to find 11 other people living there. I went with him on a return visit for a chat and ascertained that each sub-tenant paid £350 per month to the landlord’s official tenants, giving a grand total income to them of £92,400

Deduct his lawful rent payments and his tenants had made, from the sub tenancy £54,400 in two years.

Add people renting out sheds and garages - even inaccessible basements - and you have a proposal that will do nothing to reduce immigration but will make life more miserable for thousands of those ordinary hard-working families (the ones who've travelled half way across the world to do the hard work). And lucrative for criminals.

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Shelter should be supporting the private rental sector not trying to regulate it to death

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In an egregious piece of research (in every sense of the word), Shelter claimed - more or less - that private landlords were killing children:

Shelter’s research, released today, based on a YouGov survey carried out in November last year of 4,327 adults in England living in the private rented sector, found 44 per cent of the respondents said their child would have a better childhood if they had a more stable home.

Well not quite killing children. And not even half of the respondents either. Indeed it is true that many people living in private rented property, just like many living in the social housing sector, would have wished for a more stable place to bring up the children. However, it simply does not justify the over-the-top comments from the big Shelter boss:

Shelter’s chief executive Campbell Robb said the findings of its report Growing up renting proved ‘that today’s volatile rental market is simply not fit for purpose’.

Now I don't wish to be boring here but what Shelter are doing (egged on by the Labour Party and local council leaders who really should know better) is mounting an attack on private landlords. The idea that private landlords would prefer to kick out a tenant after six months is arrant nonsense - the volatility is mostly down to the tenants not the landlords.

If these idiots from Shelter (and the Labour Party) get their national register of landlords - doubtless under the aegis of a new regulatory body, OfRent or whatever - the result will be to raise rents, reduce supply and exacerbate housing problems in places such as London. Instead of damning landlords with exaggerated claims of their evil nature, Mr Robb should be supporting the private rental sector, helping it to meet the complicated and varied needs of people needing housing.

But then that wouldn't get a headline, would it?

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