Private landlords turn down young tenants
February 10th, 2011
The National Landlords Association have surveyed a third of its members who let to tenants on housing benefit. Of this group, 31% said they would reduce such tenancies now, while less than 1% said they planned to increase such tenancies during 2011.
Many private landlords had expressed their concerns even before the General Election, about the Government’s plans to pay housing benefit to tenants rather than straight to landlords since this had caused a growing rental arrears problem.
One of the key changes planned for next January will be to encourage younger tenants to live together in shared properties rather than more expensive one-bedroom flats. The Shared Accommodation Rate currently limits the benefit a single person under 25 can receive to the average rent charged for a room in a shared house.
There are also not enough shared properties to accommodate the increased demand the Coalition’s proposed cuts will trigger; Shelter says 87% of local authority housing officers it surveyed already had difficulty finding places for under-25s on the shared accommodation rate. It says this shortage will become acute when the net includes those up to the age of 35.
The Government has defended its proposals on several grounds. One argument is that the cut in benefits might encourage more families to take in lodgers under the rent-a-room scheme, where some of the income is tax-free. Steve Webb, Liberal Democrat Pensions Minister, has said, “As young people start to realise they cannot get benefit for a flat on their own and start to look for lodgings, another family who may have lost income through redundancy might wish to let their spare rooms.”
At Happy Homes Investments we always advise using a fully qualified and reliable letting agent to ensure the reliability of your tenant.