Only 20% of landlords will rent to tenants on benefits

Research released last week by the National Landlords Association (NLA). reveals that only two in 10 landlords are willing to rent property to tenants in receipt of housing benefit or universal credit, down from 34% at the start of 2013.

The research, taken from the NLA’s Quarterly Landlord Panel, also shows that two in three landlords who let to housing benefit recipients say they have fallen behind on rental payments in the last 12 months.  Universal Credit in particular appears to be creating multiple problems for both Landlord and Tenant.

Further figures obtained by the Observer in September under the Freedom of Information Act show that even tenants in social housing are being adversely affected by the new benefit.  Their figures showed that half of all council tenants across 105 local authorities who receive the housing element of universal credit – which replaces housing benefit – are at least a month behind on their rent, with 30% two months behind, whereas less than 10% of council tenants on housing benefit are a month behind on their rent, with under 5% running more than two months behind.

The NLA has already provided written evidence to the Committee’s inquiry, outlining some of the major problems the new system is causing landlords, and why so many are shying away from accepting Universal Credit tenants. These include:

  • The difficulty of communicating and interacting with the Universal Credit administration system.
  • The time and effort it takes to secure direct payment of the housing element of Universal Credit to the landlord, and
  • The six week waiting period causing tenants to be two-months in rent arrears by the time of the first payment

The National Landlords Association (NLA)  has joined calls for the Government to reconsider the national roll-out of Universal Credit, and also to lift the current freeze on housing benefit rates.

Richard Lambert, Chief Executive Officer of the NLA, said:

“Underlying all the problems with Universal Credit is the freeze on housing benefit rates, which means that the housing element of Universal Credit is simply insufficient for many tenants to be able to cover their rent.

“The decline in social housing means that some of the most vulnerable in society can only turn to the private rented sector. We have long called for the freeze to be scrapped as it creates a barrier that prevents claimants from securing the housing they need.

“If the Government is serious about helping then it needs to press pause on the roll out of Universal Credit, and fix its underlying problems. Otherwise more and more people will find themselves homeless as the proportion of landlords who consider themselves able to house those who need it most will keep on falling.”

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