Housing Benefit Tenants Welcomed by Just Two in Ten Buy to Let Investors

A mere two in ten buy to let investors have said that they are willing to let to tenants who receiving either housing benefit or universal credit, according to the latest research from the National Landlords Association (NLA).

This research has revealed a drastic decline in those willing to let to housing benefit claimants. At the start of 2013, 34 per cent of landlords were willing to let to claimants, a number which has since dropped to just 20 per cent.

The findings, which originate from the NLA’s Quarterly Landlord Panel, also reveal that two in three landlords who let to housing benefit claimants have fallen behind on rental payments in the last 12 months. This information provoked the NLA to provide written evidence to today’s work and pensions committee’s inquiry, outlining some of the significant problems that the new system is causing landlords. The evidence aims to outline why so few property investors are now willing to take on Universal Credit claimants.

The issues highlighted by the NLA include the difficulty of communicating and interacting with the Universal Credit administration system coupled with the time and effort it takes to secure the direct payment of the housing element of Universal Credit to the landlord. A final issue was the six week waiting period, which is causing tenants to be two-months in rent arrears by the time of the first payment.

The NLA is calling on the Government to lift the current freeze on housing benefit rates and stop the national roll-out of Universal Credit until the concerns have been addressed.

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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