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Written by rosalind renshaw

Over three-quarters of private landlords who currently accept housing benefit tenants are set to be forced out of the market, unable to afford to continue letting to those on lower rates of Local Housing Allowance.

A new survey of 528 landlords in October by the National Landlords Association has found that Government caps being rolled out on housing benefit payments will have a serious effect on tenants reliant on LHA.

The first cuts, affecting new tenants, came in last April, and the second round, affecting existing tenants on LHA, are due to be implemented in the New Year.
 
The survey found that 77% of landlords who have LHA tenants are either considering or already taking steps to reduce their involvement in the LHA market.
 
A quarter of respondents say they are already reducing the number of tenants they have on housing benefit payments, while half plan to do so in the future.
 
NLA research has found that the LHA cuts will have a varied impact on families across the country, with some losing very little but others losing hundreds of pounds.
 
Government figures show that nearly 1.3 million households currently claim LHA across the UK.
 
Some examples of how the caps will reduce LHA payments, based on rates from March 2011 before the cuts began in April, are:
 
    •    A one-bedroom flat in Willesden, north-west London: before the cap, the rate was £275 per week, now it is £250 per week – a £25 cut per week.
 
    •    A five-bedroom house in Guildford, Surrey: before the cap, a family would have received £691.15 per week, now it is capped at the four-bedroom rate of £400 per week – a £291.15 cut.
 
David Salusbury, NLA chairman, said: “The shortage of housing across the UK is putting even greater pressure on the private rented sector. Capping housing benefit payments at this time will only lead to more people struggling to pay their rent.

“The Government must monitor the impact of the roll-out of LHA caps. It is essential that tenants are not left at risk and that landlords can continue to provide this accommodation for the more vulnerable in society.

“The number of people claiming benefits continues to rise, and these caps could result in fewer affordable rental properties for benefit claimants.”

Comments

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    >Good. Why should our taxes subsidise over-leveraged landlords?

    Errmmm... excuse me! Why should our taxes subsidise the feckless workshy "I'm entitled to this house" benefits scroungers? How about they get a job and earn their own way in life like the rest of us, rather than be sponging scrounging freeloaders and expect the taxpayers to subsidise them? Too many people in this country opt for a life on benefits and CHOOSE to be unemployed, rather than stand tall and earn their own way in life.

    > For far to long A lot of Landlords have been miking it for what is worth

    No no no! You're showing a fundemental mis-understanding here of how the LHA and benefits system work as it's the councils that set the rates they pay, not the landlords. LHA are fixed rates which landlords have no control over. How about you educate yourself before posting comments like that? Buy a house and perhaps rent it out to the DSS before committing to display your ignorance online?

    I am a landlord, renting 17 of my houses to DSS (mainly single mums who churn out kids to get a bigger house, you know, 3 kids, 2 dads, unemployed workshy types) and a business owner that can never get enough staff as many of the candidates we interview want "cash in hand" so they can continue claiming benefits.

    This thread has shown a lot of ignorance, which is really sad :-(

    • 05 November 2011 20:41 PM
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    Buy to Let is an investment, and landlords have become used to an income stream and substanial capital growth. With the latter now uncertain, increasing the former makes financial sense, and with so many unable to afford purchase, the market demand is there. Rent regulation has been eroded over the years, and we'll now pay the price as our lower paid workers can no longer afford to live in the areas where we need them.

    • 04 November 2011 21:45 PM
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    All the 'help' that people get to pay for housing (such as shared ownership for purchase or housing benefit for rent) pushes prices up. If you cut the subsidies it will not cut the supply of housing, it will cut demand. The result of lower demand: same number of properties, same number of people housed, but lower prices.

    • 04 November 2011 17:18 PM
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    About time. The rent is way too high it should be cut even more in some areas.

    For far to long A lot of Landlords have been miking it for what is worth and People would been living of the benefit had a free ride. It time to help Low paid Brits. Just over the bread line.

    These landlords will be back!! if they could get the property rented easily they would not have chosen LHA tenants !!!

    • 04 November 2011 11:30 AM
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    Although I am a LL myself, the country / Local Authorities are bankrupt and cannot afford the massive rents that London in particular demand.
    We are now living in a different world.
    Shortage of rental property has forced up rents short term & the next 12 months will see even more shortages BUT let's not get carried away, there have to be Tenants in work and able to pay your rent every month. That's the next shortage!
    I am not being over gloomy but realistic.

    • 04 November 2011 10:47 AM
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    So where are the non LHA tenants going to come from. LHA has been a massive subsidy (together with tax relief on excessive interest paid) to landlords for many years. Surely no one can complain what it is withdrawn? If landlords want to walk then let them. Not many places to go. The shortage argument has become over played. withdrawing subsidy equals lower rents and lower house prices.. surely goods news for the economy.

    • 04 November 2011 10:33 AM
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    Hi Clive, what gives you the right to be so smug. Did you buy your property so long ago that you are making a fat profit every month and therefore begrudge anyone else to do the same.

    Have a look at BTL deals available Clive....its not so easy as when you first started....

    • 04 November 2011 10:25 AM
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    Good. Why should our taxes subsidise over-leveraged landlords?

    • 04 November 2011 10:06 AM
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    • 04 November 2011 08:36 AM
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