Housing : Social Tenants / BTL & HB Problems / Shortages / Shelter & Other Reports

Discuss news stories and political issues that affect carers.
101 posts
An interesting one ... UC effect on mortgage applications ?

Sounds weird but ... here we go :


https://www.theguardian.com/society/201 ... mortgages.


Universal credit in new crisis as some claimants are denied mortgages.

A standoff between banks and the government means that loan applicants could be rejected if they receive the new payment. We speak to a buyer caught in the middle.


Thousands – perhaps even millions – of people could have trouble obtaining a mortgage because of problems with the way the government’s universal credit system and banks and building societies “talk” to each other.

A Guardian Money investigation into the difficulties experienced by a homebuyer living in one of the areas chosen to test the new benefit has revealed that some recipients could be at risk of being turned down for a mortgage. Some lenders are saying they will not accept universal credit at all when calculating how much they will lend, while others have apparently not amended their IT systems to deal with it – leading to problems and delays. On its published list of acceptable income types, Halifax’s website simply gives a blunt “no”.

Many lenders do accept it in some situations, but a key problem is that the most up-to-date version of universal credit is fully online and paperwork-free. Many banks and building societies, however, still insist on an official “hard copy” letter detailing how much benefit someone is getting. In essence, it’s an “old tech v new tech” clash.

At the moment there are a relatively small number of people on this so-called “full service” digital version of the new benefit. However, the roll-out is being ramped up dramatically. By 2022 an estimated 7 million people are expected to claim universal credit, which incorporates six different benefits and tax credits (including child tax credit and working tax credit) into one (see below).

The mortgage problem came to light after Julie Broughton* contacted Money to say that she was worried she could lose the mortgage that had been agreed in principle by NatWest. She said the bank had slashed the amount it was willing to lend her from £103,000 to just £59,000 because she wasn’t able to provide it with a written letter from the Department for Work and Pensions detailing the breakdown of her payment.

“Because I can’t provide them with that one bit of paper, they have removed that income from the total … this is going to affect so many people who may now not be able to obtain a mortgage,” she claimed.

Broughton, who lives in north-east England, is among the first tranche of people to be moved to the fully digital service. At the moment around 600,000 people are on universal credit, though most of these are on the slightly less hi-tech “live service”.

Broughton is a divorced single parent who works for a charity and is currently selling the former marital home and buying a smaller property. Her income – from work, maintenance from her ex-husband, and universal credit – plus the equity she already has in the property, means she can afford a mortgage in her own right.

An “award letter” from the DWP can be a useful way of officially proving entitlement to a benefit, but it is understood that these are no longer being posted out. Some individuals applying for a home loan are submitting a print-out or screen-grab from their universal credit online account – as Broughton did – but this is being rejected as unacceptable.

Another problem is that while universal credit incorporates lots of existing benefits, many lenders only accept some of these when totting up an income. If the individual is unable to provide a clear breakdown of their benefits, the lender may decide not to take any of the payment into account.

All of these could mean a big cut in how much someone is able to borrow – which could be disastrous. Broughton’s case could therefore be the tip of the iceberg.

While Halifax says a flat “no”, it adds that it does accept some of the components of the benefit as income, including working tax credit and child tax credit. By contrast, Leeds building society says it will consider working tax credit but not child tax credit.


Catherine McKinnell is Labour MP for Newcastle upon Tyne North, and Broughton is one of her constituents. She told Money that “it cannot be right that the very system that is supposed to be a safety net is standing in the way of finding a home, and is clearly going to affect many others if it is not urgently addressed”.

She adds: “It is yet another example of how the implications of an entirely online benefit simply haven’t been thought through.” She has raised the issue directly with the DWP and asked it to come up with a solution.

David Hollingworth at broker London & Country says that when he asked mortgage advisers at the firm about their experiences, one reported a case of a client who was in receipt of universal credit and was seeking a mortgage from a leading lender. In that instance, the lender wasn’t able to confirm the split between the different components of the benefit, only some of which it would accept. As a result the lender decided it wouldn’t take any of the client’s payment into account.

The good news for Broughton is that NatWest later agreed to approve her application. But she says it “remains firm that without the paper statement, it will not include universal credit in its calculations. Though the outcome for me has been positive, it seems unlikely that future applicants will be as successful”.

Money contacted the DWP about these issues. It told us that universal credit is modernising the welfare system and gives people 24-hour access to information about their claim, in the same way that many people bank online.

It adds: “Everyone’s claimant statement shows the breakdown of their payment. People can show this via their online account or print out their statement. A lender should accept this as evidence, but if they refuse people can speak with their work coaches.”

NatWest, however, confirms that it still requires “written proof”. “We need to fully understand the breakdown … we haven’t been told that situation has changed. The reason is that these online print-outs don’t include the breakdown required”.


I doubt if many readers will have this problem ?

Seems to be a software problem on first read.

Trouble is , not easy to negotiate ... a symptom of UC.
A related article that does dovetail into this thread ... UC element for one . BTL tenants another :


http://www.independent.co.uk/news/uk/ho ... 75881.html


Housing helpline recruits extra advisers in anticipation for soaring demand over Christmas period.

New figures show Shelter received call for help every 22 seconds in run-up to Christmas last year, and charity warns situation set to get worse this winter.


One of Britain’s biggest housing charities has drawn in extra advisers to man its helpline over the Christmas period, in anticipation of soaring demand as the housing crisis “spirals out of control”.

New figures reveal Shelter received a call for help every 22 seconds in the run-up to Christmas last year, and the charity is warning that the situation this winter is set to get worse.

The helpline received over 100,000 calls in the two months leading up to Christmas last year – while more than 500 calls were made on Christmas Eve and Christmas Day alone.

With the total number of calls having increased by 25 per cent over the past year, the charity said its expert advisers are already overwhelmed with pleas for housing help.

A spokesperson told The Independent they expect demand to be so high this year that they have recruited four additional advisers to man the phones over the festive period, bringing the total number of advisers to 31.

They said they anticipate huge numbers of people will come to them for support, as a crippling combination of rising homelessness, sky-high rents, problems with universal credit and a dearth of affordable homes are causing the housing crisis to “spiral out of control”.

The number of rough sleepers in the UK has soared by 134 per cent since 2011, while there has been a 60 per cent rise in households in temporary accommodation in the same period, according to a recent report by the National Audit Office (NAO).

Rents went up at the same time as household incomes from benefits were cut, with rent costs across England increasing by three times as much wages, except in the North and the East Midlands, the research showed.

Alarmingly, over the same period, spending on other services, such as prevention, support and administration, fell by 9 per cent – from £334m to £303m.

Many homeless families who have been housed in temporary accommodation will be spending Christmas in hostels and bed and breakfasts located miles from their original homes and families, while other people will be spending the day on the streets.

Mark Cook, a helpline adviser for Shelter, said: “Every Christmas I speak to parents in despair as they face the trauma of homelessness, when they should be filling stockings and looking forward to Christmas dinner.

“Even though I’ll be working at Christmas, I think myself so lucky to be able to go home at the end of the day when there are so many families having to go without such a basic need. No family should face the agony of losing the roof over their heads.”

The Shelter helpline is funded by M&S customers throughout the festive season, with 5 per cent of every purchase made from the “Festive Collection for Shelter” going directly to the charity.

A Government spokesperson said £20m of additional funding was being provided to ensure more people who are homeless, or at risk of becoming homeless or sleeping rough, are able to get new tenancies in the private sector or support in sustaining existing tenancies.

He said: “Tackling homelessness is a complex issue with no single solution, but we are committed to do more to prevent more people becoming homeless in the first place. That’s why we are investing nearly a billion pounds up to 2020 to prevent and reduce all forms of homelessness and rough sleeping.

“We are also implementing the most ambitious legislative reform in years – the Homelessness Reduction Act – that requires councils to provide early support to people at risk of being left without anywhere to live.”


Oh what tidings and joys for some this so called festive season !

DWP Christmas card ... " Happy Christmas , you have been sanction ! "

BTL landlord ... " Sorry , I will not be renewing your tenancy at the end of this month. "

A problem which will only escalate.
Good news this morning for anyone renting from a BTL in Scotland :


http://www.bbc.co.uk/news/uk-scotland-42179428

" New dawn " for Scottish private renters.
Major changes to the law have come into effect for Scotland's 760,000 private renters.

The private residential tenancy rules will bring an end to fixed-term rentals, meaning leases will effectively be open-ended.

Rent increases can only be made once every 12 months, and tenants who believe them to be unfair can take them to a rent officer.

Shelter Scotland described the change as a "new dawn" for private renters.

Anyone signing a tenancy from 1 December will be covered by the new rules.

All landlord and tenant disputes will be heard in a new specialist tribunal and, from next month, all letting agents will have to register and adhere to a code of practice.


Security for tenants

Tenants will have indefinite security of tenure, meaning "no-fault" evictions will no longer be possible.

Other key measures include:

Longer notice periods, with tenants who have been in a property for more than six months receiving at least 84 day notice to leave, unless they are at fault
Simpler notices, with a simpler notice to leave process
The introduction of a model tenancy agreement which can be used by landlords to set up a tenancy


The new law does, however, allow landlords to ask tenants to leave on a number of grounds, including wanting to sell or refurbish the property or if they intend to live there themselves.

If the tenant fails to vacate at the end of the notice period, the landlord can apply to a tribunal for an eviction notice.

The new law has been welcomed by housing charity Shelter Scotland.

Director Graeme Brown said: "Today represents a new dawn for all private renters in Scotland.

"These new laws bring unprecedented security of tenure to private renters, with landlords now needing a good reason to evict tenants.

"We have campaigned passionately for 10 years now for reform of private renting in Scotland, ending with our Make Renting Right campaign, which had extensive support from the public and local and national politicians."


He added: "Shelter Scotland is pleased to be working with the Scottish government on a major awareness raising campaign to ensure that everyone involved in private renting - from tenants and landlords to letting agents and housing professionals - understand their new rights and responsibilities."

'Less paperwork'

Independent property specialists Rettie and Co have landlords and tenants as clients.

Their director of research Dr John Boyle said: "It will make things a bit easier to organise. It should be a smoother process with less paperwork."

He pointed out that most tenants and landlords have a good relationship, but said the rules will change when things go wrong.

"The end of no-fault possession will be a concern," he said. "(But) there are grounds for possession and these may prove to be workable."

Dr Boyle said some owners will worry that there is no initial minimum period of rental.

He said: "In essence, the tenant has long-term security but the landlord does not. That weakens security for the landlord."

In areas like Edinburgh, Dr Boyle said there may be problems for landlords who rent to students during term-time, then to festival-goers in the summer.

Some landlords may decide to pull out of the student letting sector if they cannot be sure of students moving out at the end of the academic year.

The legislation also allows for Rent Pressure Zones, where annual rent increases would be capped. Dr Boyle points out that, in other countries with similar regulations, long waiting lists for housing can build up.

But the Scottish government believes it has struck the right balance between the needs of tenants and landlords.

Housing minister Kevin Stewart said: "This is the biggest change to the sector for a generation and will bring about significant improvements in private renting, benefiting both tenants and landlords.

"The new tenancy sits alongside our wider ambitions for housing in Scotland - not least our ambitious commitment to deliver at least 50,000 affordable homes during this parliament, including that for rent."

What is it like to live in rented accommodation?


Leanne McGuire has lived in the private rented sector for most of her adult life. With her daughter Cleone to consider, she says security of tenure has become very important.

"I've lived in private rent from when I was about 20, so you're talking 17 years I've been private renting.

"In those 17 years, I've had four or five flats sold from under me.

"Before I had Cleone, I moved around a lot - of course I did because you're younger and you don't really have a lot of responsibilities.

"If I didn't like a flat that was fine. I just moved our after six months.

"But since having Cleone we've settled and unfortunately that first flat that we had together - it was very sudden - I had been paying rent but the landlord hadn't been paying his mortgage.

"We ended up having to be evicted from there and move on.

"That's quite stressful.

"Then the next flat we stayed in for seven years, which was great.

"We had put down a lot of roots. That's where Cleone grew up, almost.

"Unfortunately we found out last year that (the landlord) wanted to sell and he gave us two months to find somewhere else."


First the Travel thread , now private tenants.

Good 24 hours for Scotland ?

Now for the rest of the UK.

Nothing like a little bit more security for the roof over one's head ?
One for me , and any other reader on a BTL tenancy , to read and digest ... Patrick Collinson , today's Guardian :

A ticking time bomb especially as the BTL market is in private hands :


https://www.theguardian.com/money/blog/ ... homeowners

Pensions aren’t the ticking timebomb – rents are.

Non-homeowners currently in their 50s face having to find huge amounts of money to pay ever-escalating rents.


Scottish Widows is the sort of unassuming pensions company that rarely likes to publicly criticise government policy. But an analysis it published this week is a stark warning about the ticking time bomb that will explode in 10 to 20 years’ time. And it’s not pension incomes that are the worry - it’s the fact that so many of tomorrow’s pensioners who never got on to the property ladder in the 2000s and 2010s will have to find huge amounts of money to pay ever-escalating rents to private landlords.

Scottish Widows skirts around the issue by suggesting that non-homeowners currently in their 50s should start saving an extra £6,000 a year now to be able to afford their rent in retirement. As if people on low incomes are going to find that sort of money. The reason they are renting is that they were never able to find the savings for a deposit on a house in the first place, or didn’t earn enough to qualify for a mortgage.

The reality is that these people are likely to retire with little more than the state pension plus a small bit of private pension. Maybe they will be picking up about £200 a week once they are 67. Given that the average rent in England and Wales is £845 a month – and in London it’s about £1,250 a month – then the whole lot will be gobbled up by the landlord. So the taxpayer will have no alternative but to step in and pay most of the rent, and we are then on the hook for payments going on for maybe 20 or 30 years. All so that the buy-to-let landlord with multiple properties can enjoy a lavish retirement themselves.

This is the lunacy of promoting buy to let as a long term form of tenure for millions of people. Even in developed countries where renting is common, such as Germany, most people are living in a home they own by the time they reach retirement. Renting all the way through retirement, funded by the taxpayer, to a landlord who has the power to evict without reason and at short notice, is the worst possible situation. And it’s one we are hurtling towards.

Make no mistake about the dramatic change in the retirement landscape that is coming. Scottish Widows projects that one in eight retirees will be renting by 2032 – treble today’s figure. After that it will continue rising. It says there is a £43bn gap between the income and savings people have now and what the rent bill will be in retirement. That’s more than one-third of the entire NHS budget for a year – to be squandered on rent.

Dan Wilson Craw of campaign group Generation Rent says: “The common perception is that retirees either own their home outright or have a council tenancy, so the government will be in for a nasty shock as more of us retire and continue to rent from a private landlord. Many renters relying on pensions will qualify for housing benefit which will put greater strain on the public finances.”

Aviva, the UK’s biggest pensions company, also publishes figures on Saturday on the colossal financial issues facing non-homeowners currently in their 50s. While those who have bought their homes feel pinched - and expect to use the equity in their home to pay for a better retirement - the outlook for non-homeowners is so grim that 20% believe their only hope is having a lottery win. Most non-homeowning workers aged above 50 say they have no money left after basic costs to put aside extra money for a pension.


There was some good news on pensions this week: the Resolution Foundation said that auto-enrolment schemes will mean tomorrow’s pensioners will enjoy a roughly similar income (about £300 a week) to today’s pensioners. But they didn’t account for the large number that will now have to pay rent out of that money.

The solution? Build more houses, of course. But even 300,000 a year won’t solve this problem if they are snapped up by landlords. That only leaves us with rent control and much higher taxes on buy to let.


Solve this one ?

Not in this lifetime.

The whole HOUSING issue will not be solved THIS CENTURY.

.... unless nature decides otherwise ?


Comments section buzzing ... one to end ... as an epitaph ?
Absolutely. The failure of successive governments to do ANYTHING for those who could never possibly afford to buy, is one of the biggest issues facing our society.

The fact that the poor (and now not so poor) are left to the mercy of a disfunctional private rental market is a disgrace.

Proper council housing and proper, fit for purpose regulation of the rental market is urgently needed.

All this tinkering around at the edges of the sales market is completely pointless. It has been shown to do nothing for affordability.

The only people who gain from a cut in stamp duty are current home owners, as it just pushes prices even higher.

Renters haven't had the political clout for too long, but that's going to soon change as so few can afford to buy.

Here's hoping vested interests lose out to what the vast majority of the population will soon demand (that's me speaking as a home owner who had do very well out of house price inflation, but I recognise securing appropriate housing is hell for many).

I won't hold my breath though.



Be a very long breathe ?

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On your manor ... BTL landlords still letting to benefit claimants ???

Renewing the 6 / 12 month tenancy agreement without question ???

If my manor , Worksop , is anything to go by .... ???
Wales and scotland show England a clean pair of heels :


https://www.theguardian.com/housing-net ... sh-problem

Welsh lesson: why the housing crisis is turning into a very English problem.

With Wales and Scotland tackling homelessness and housing affordability, the English housing crisis lies squarely at the door of the Tories.


On 6 December, the Welsh assembly passed a bill designed to try to halt the death of social housing in the region by banning right to buy. The bill is due to come into force by May 2021 and is crucial at a time when the number of social homes in Wales has fallen by 45% due to housing being sold off under the right-to-buy scheme.

Wales is leading the way on working to combat the housing crisis, using what tools it can. The Welsh assembly has more limited legislative powers than Holyrood or Stormont, but the devolved region has managed to implement a different homelessness strategy to England, and gives everyone the right to housing, wherever they come forward for help.

So, if a homeless person approaches Cardiff council, the council is duty bound to help. There is no talk of local connection, which has become a crucial barrier to many people accessing homelessness services in other parts of the UK, or points-based needs assessments that have seen young single men pushed back onto the street.

The Conservatives in Wales attempted to delay the bill, arguing for tenants to have two years to purchase their homes before the new rule comes in. That move was rejected, and many areas of Wales have implemented the ban. Under existing powers, Anglesey, Cardiff, Carmarthenshire, Denbighshire, Flintshire and Swansea councils have banned right to buy.

The blight of holiday homes lying empty and pushing up local prices has also been tackled by the Welsh government. In many regions, holiday homes and second homes left empty are now charged double the standard rate of council tax. This potentially puts off people whose finances might just stretch to another property, but also increases revenues for councils.

And there’s more to be learned from Wales; housing associations there enshrine domestic violence policy in their working practices and, after an intervention in 2014 by the late Welsh housing minister Carl Sargeant, housing associations that don’t have a domestic violence policy will be denied crucial funding.

In practice, this means housing professionals have a duty to ask, sensitively and following agreed guidelines, if they believe there is a possibility of domestic abuse. That duty falls to all frontline staff, including a repairs team member who might notice a pattern of damage in a property, an antisocial behaviour officer or a finance team member for whom a pattern of arrears might raise alarm bells.

That Wales has soldiered on with legislation and policies that could genuinely improve the rights of Welsh tenants and protect the limited social housing stock in the region is commendable, given the pressures on its finances thanks to Westminster, and the lack of political leadership from London. Scotland, too, has taken action to halt its housing crisis.

In his budget, Philip Hammond made the right noises about the plight of young people stuck with high renting costs, but offered nothing radical or helpful to address their problems.

And what about those in need of social housing, or homeless and in need of any form of housing?

England appears too scared to act on housing for fear voters will bolt like terrified horses at the first sign of sinking profits and assets if house prices decline. If the political situation continues in this manner, the housing crisis will be an exclusively English problem, and the blame will lie squarely at the Conservatives’ door.


A nation divided ?

Always has been ... if only on the haves and have nots ?

Housing ... essential ... as are food and energy.
Right to buy ?

Been good for some ... especially BTL landlords ?



https://www.theguardian.com/society/201 ... landlords.


Four in 10 right-to-buy homes are now owned by private landlords.

Tenants living in homes sold under Margaret Thatcher’s scheme now pay twice the rents charges by local authorities.


Four out of 10 council homes sold under Margaret Thatcher’s flagship right-to-buy policy are now in the hands of private landlords, with their tenants paying more than twice the rent levels charged by local authorities.

Freedom of information (FoI) requests sent to 111 English local authorities by Inside Housing magazine reveal that 40.2% of housing stock sold by councils to then tenants are now rented out, rising to 70.9% in Milton Keynes, which it dubs the “right-to-buy-to-let capital” of England.

Seven councils – Milton Keynes, Bolsover, Brighton & Hove, Canterbury, Cheshire West and Chester, Stevenage, and Nuneaton & Bedworth – have letting levels of more than 50% among former council-owned homes.


Thatcher promised that right to buy would result in a property-owning democracy, but with so many homes now sold on to landlords, critics say the government has been left paying huge amounts of housing benefit to buy-to-let landlords charging high rents.

Precise figures on rents paid are unavailable. But Inside Housing said the average council rent in England was £88 per week, compared with £210 charged by private landlords. In London, this gap grows from £108 for council rents to £359 for private rents.

The figures will intensify the controversy over right to buy. The government has confirmed its intention to extend right to buy to more housing association tenants, with a regional pilot in the West Midlands planned for next year.

A Department for Communities and Local Government spokesman said: “More than 77,500 tenants have used right to buy to purchase their home over the last five years, helping more people own a property.

“There are restrictions on selling on a property bought under right to buy within five years, and under our reinvigorated scheme every additional home sold off must be replaced by another one, nationally.

“Councils should deliver these additional affordable homes within three years, and so far they have achieved this.”

But critics called for an end to right to buy and renewed building of social housing. Seb Klier of the campaign group Generation Rent said: “The growth of the private rented sector in former council homes has come at huge cost to the state and society, with a higher housing benefit bill, renters in much less secure homes, and a loss of housing stock for tenants and leaseholders.

“An end to right to buy will allow us to once again produce a housing stock that is genuinely affordable for most people.”

The data shows that the appetite among landlords for buying former council homes shows no sign of abating. When Inside Housing carried out a similar survey in 2015, it found that 37.6% of former council homes sold under the scheme were in the hands of landlords. It said it anticipated that by 2026 half would have been taken over by private landlords.

The true figure for the proportion of former council homes now in the hands of landlords could be even higher than the FoI data suggests, said Eamon McGoldrick, managing director of the National Federation of Almos (arm’s-length management organisations), which manage council housing on behalf of local authorities.

“Leaseholders are allowed to sublet but some of them don’t actually inform the council that they’re doing it, possibly because they think it will be an issue.

“So there will be another number on top of this figure that haven’t given the freeholder an away address. You can probably add another 5% on to the levels we know about.”


Follow the money !

Rents raised ... HB needed to pay ... funded by the taxpayer ... rent paid to a private landlord.

Makes sense ?

You bet it does ... for the taxpayers to subsidise private landlords ... profit from the rent , and capital appreciation on their investment.

Oh , just one more thing ... 2 in 5 of present day mps are also BTL landlords.

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One comment I can vouch for ... from my own banking days !
Right to buy was ruthlessly exploited by property investors involved in the semi-legal exploitation of some of the poorest tenants.

What they would do is leaflet a council estate offering to pay money to people to enter into a contract to use their entitlement to right to buy.

So say the home is worth 100K the tenant is entitled to a 40% discount they would use their finance to buy the property and pay the tenant between 30-50% of the value of the discount and the tenant would stay living and paying rent in the property guaranteed up to the point the the tenant was legally able to sell the home on (usually three years) then the investor would put the rent up to the full private market rate.



Yes , a few saw what opportunities there were at the very beginning ... some even toured local estates to sign up tenants on the dotted line.
For regular readers of this thread , the following article will come as no great surprise.

Hats off to the Guardian ... still publishing despite the distractions at this time of the year !


https://www.theguardian.com/society/201 ... recipients


Landlords ‘unwilling’ to rent to universal credit recipients.

Landlords’ association reports huge rise in non-payment of rent in areas where universal credit has been introduced.


Universal credit will lead to a “steady decrease” in the number of landlords willing to rent out properties to benefit claimants because it encourages tenants to fall into arrears, the National Landlords Association (NLA) has warned.

Only 18-20% of private landlords accept tenants who pay their rent with local housing allowance (LHA), the housing benefit that will eventually be replaced by universal credit – down from 46% in 2010/-11, the NLA said.

The latest survey of NLA members showed that 68% of landlords with LHA tenants and 63% with other benefit recipients experienced rent arrears in the last 12 months. LHA tenants owed an average of £2,263, compared with £1,774 by all tenant types.


Richard Lambert, the NLA chair, said LHA claimants fell into arrears because the allowance did not cover the cost of housing. Rents have gone up typically by 2-3% annually while benefits have been frozen, and many people struggle to make up the shortfall from other benefits if they are not in work.

“We expect this problem to be exacerbated by universal credit when it rolls all the benefits together in one monthly payment,” he said, adding: “We expect to see a steady decline in landlords being willing to rent to benefit claimants in the next 18 months to two years.”

Almost a third of landlords have sought vacant possession of one or more properties from LHA tenants, compared with 15% overall, Lambert said.

In areas where UC has been introduced, landlords report a dramatic increase in non-payment of rent.

Under universal credit, payments of housing benefit for new single claimants is replaced by a “housing costs element” included in their UC award. In most cases it is the claimant’s responsibility to pay the rent to their landlord from this award.

In Buxton in the Peak District, where single people have been on UC for two-and-a-half years, one letting agency said 90% of its UC tenants were in rent arrears.

SJ lettings, which specialises in renting out rooms in shared houses, said that of its 20 UC tenants, nine have already been evicted for failing to pay the rent and a further nine were in serious arrears. Only two people were keeping up with their rent payments.

Simon Graham, the director of SJ Lettings, blamed the problems on universal credit, coupled with the harsh sanctioning regime for jobseeker’s allowance claimants.

“In theory, universal credit is an empowering idea, encouraging people to learn to budget for themselves, but for the more vulnerable tenants, someone with drug or alcohol issues or mental health problems, being given £600 at the start of the month and expecting them to make it last until the next month is just not realistic,” he said.

Buxton has seen a rise in drug-related problems since the rollout of UC began, he claimed, saying: “It’s anecdotal but to me there is a correlation between tenants being paid their housing benefit directly and the rise in the buying and selling of drugs in Buxton.”

Landlords do not want to evict their tenants, Lambert said, claiming it costs an average of £1,800 to cover the cost of ending one tenancy and starting another.

“Landlords and property owners often get bad press and often for good reason, but we look after a couple of landlords who have just one property they rent out as their pension. They are sympathetic to their tenants but if they do not receive that rent then they are the ones who fall into hardship,” said Graham.

Ruth George, the Labour MP for High Peak, where Buxton is located, recently set up an all-party parliamentary group for MPs to discuss problems with UC.

“You can’t say to private landlords that they should just soak up the losses. It’s just not practicable for them, unlike perhaps big social landlords who can take more of a hit,” she said. “They do not receive the arrears back in the vast majority of cases and so it is not surprising if they cut their losses.”

A spokesperson for the Department for Work and Pensions said: “Universal credit lies at the heart of our commitment to help people improve their lives and raise their incomes. It provides additional, tailored support to help people move into work and stop claiming benefits altogether.

“The vast majority of claimants tell us they are comfortable managing their money. Budgeting support is there for anyone who needs it and arrangements can be made to pay rent direct to landlords if needed.

“From April, anyone in receipt of housing benefit who moves on to universal credit will continue to have their rent paid for two weeks during the wait for their first payment.”

In Buxton, as in many other towns and cities in the UK, a boom in student accommodation has provided landlords with another safer and more lucrative option, said Graham.

The University of Derby has a campus in Buxton, where students expect to pay £128 a week for a room, while LHA is only £67.93 for a single person under 35, he said. “If you are a businessman and are looking to maximise profit, why would you even take the risk of accepting a tenant on universal credit?”


For some , an unexpected Christmas card ... an eviction notice ?
History has a nasty habit of repeating itself.

For fellow students of housing matters , a trip back to the late 1950s ... and the Rent Act 1957 ... paving the way for notorious operators like Peter Rachman.

The first wave of house conversions , and the sharp rise in Building Society lending to converted flat owners ... unknown before then.

This morning's Guardian for the 2018 version :


https://www.theguardian.com/money/2018/ ... ng-benefit

Rogue landlords making millions out of housing benefits.

‘Lockdown’ is a model that can make £56,000 a year from public funds. But the scandal goes on.


Highly organised gangs of rogue landlords are making millions every year out of the housing benefit system by enticing desperate local authorities to place single homeless people in micro-flats in shoddily converted and dangerous former family homes.

Three-bed houses, where the maximum weekly housing benefit for flat-sharers is under £100 a person, are being converted into as many as six tiny self-contained studios – as little as 10 sq m in size. Each then qualifies for housing benefit of £181 a week, enabling a landlord to squeeze £56,000 a year in rent from a property on London’s fringes, all paid from public funds. The £56,000 compares with the typical £6,200 annual rent on a three-bed council house.


A previously unpublished government report into a £700,000 project to tackle the scam, released this week under freedom of information laws, shows that councils are struggling to contain the spread of the “lockdown” model, which has taken hold in at least 12 London boroughs since 2015.

It warns of “well organised but unscrupulous landlords” profiting despite some councils – including Hackney, Bexley and Greenwich – launching prosecutions, raids and prohibition orders.

“Given available resources and the potential number of ‘rogue landlord’ properties, regulatory activity on its own would not solve the problem as long as the market was so heavily weighted to favour the supplier and the housing benefit rules allowed for high payments on such small conversions,” says the report. “Investors typically buy a three-bedroom house and convert it into six rooms, each with basic cooking facilities, in order to claim the maximum housing benefit rate.

“The lettings model was also being actively promoted as an investment opportunity amongst both existing landlords and, possibly, more widely. This has contributed to the strong growth of conversions using the model,” it says.

The report – obtained by local housing campaigner, Jon Knowles, after he appealed to the Information Commissioner – reveals “lockdown landlords” are exploiting planning loopholes created by the Conservative-led government in 2010.

“The basic premise […] was to convert houses into a large number of very small ‘self-contained’ units, each containing basic cooking facilities, but to also have a shared kitchen so as to be able to claim, for planning permission purposes, that the house was a house in multiple occupation and fell within permitted development rules,” it says.

Councils can apply to place restrictions on these rights but the report says only one councils in the project has managed to do so.

The converted flats, frequently approved by the landlord’s own private building control firms and electricians, are offered to homelessness services across the capital in need of rentals.

“The landlords often target local authority services which are looking for units when they accept either a full, or interim, homelessness duty for an individual. The landlords are aware that such individuals will be entitled to housing benefit, and are also aware how difficult it is for such services to locate suitable units,” it states.


Services from different areas regularly compete for the same properties, which can lead to “uncoordinated placements and clashes between the residents”. One incident resulted in a stabbing, and a woman living in one of these flats has been assaulted by other tenants. Checks by planning and environmental health officers are rarely carried out because homeless services are under such pressure to find rooms immediately.

“It was recognised that, with the shortage of units and the frequent emergency need for placements, the priority would often be to just get a person into some accommodation for the night.”

Housing inspectors found the micro-flats were often in very poor condition with inadequate fire safety provision and dangerously overloaded electrics and plumbing systems.

Neighbours complained of anti-social behaviour and feeling unsafe when there were influxes of often single men, with substance abuse and mental health problems .

Councils are reluctant to take a hard line because they fear it could make people homeless: “There were clear concerns about the model becoming too widespread and it was felt that changes did need to be made in order to contain its growth. However, it was accepted that these could not be wholly retrospective otherwise it would create a spike in homelessness.”

Lambeth Council, whose officers coordinated the research project and eventually released details under the FoI request, says landlords using the model were still operating in the capital and that family houses were being divided up into micro-flats all the time.

“They are always being created to meet the demand for the lack of social and affordable housing,” it says.

Knowles fought to get the report released after he discovered a string of “lockdown properties” in his neighbourhood of Hanworth, west London. “I simply could not believe that you would be allowed to cram six bedsits into a former two-bed home,” he says.

Retired builder Gary Webber found himself sofa-surfing because he could not afford a deposit on a flat in West London. He thought his luck had changed when he found a letting company that accepted people over 35 and claiming benefits.

“I stayed with a few friends and then I found out about this company that rents flats out without a deposit if you are on benefits,” he says.

A letting agent showed him what they called a flat in Hanworth but it was actually a tiny room measuring just 10 sq m, including the toilet. He took it because he “had no deposit to put down on a private flat”.

Gary, who is 63, pays £980 for his room, which is mostly covered by his housing benefit.

The people in the four other flats are charged the same, which potentially earns the company £3,920 a month in rent.

“The length of my bed is the width of the room. I’ve got a wardrobe and fridge. So I have about 10ft by 3ft of space – it’s a corridor,” he says. “There’s no room for a chair, so I lay down all day. I don’t see anyone, so I don’t get any stimulation – I’m just stuck in this room.”

Water pours down the walls when it rains because the flat roof above him leaks. It got so bad over Christmas that the council moved him to a B&B as the room was uninhabitable. But Gary – who has had a stroke and is in the early stages of dementia – has carried on paying the rent because he needs somewhere to live. “It is robbery,” he says. “They are ripping off the council. Why are they letting it go on?”


Housing ... always an area that attracts criminals ... many sponsored by " Money " provided by seemingly respectable citizens.

History is full of such relationships as any reader aware of the fallout from the 1957 Rent Act will know.

http://hansard.millbanksystems.com/comm ... t-1957-and

61 years ago but ... the House at it's finest ?
This just makes me angry. There is nothing, per se, wrong with 'microflats' for many people - as I age, I wanted less space, not more, as more just means more to heat and clean etc. Or for those 'in transition' to 'proper' housing.

The problem is with (a) that it's provided via the profit-driven private sector and (b) that it's so substandard. (Microflats can be luxuruious - think of those de luxe 'student pods' )

Instead of wasting public money prosecuting rogue landlords (who are only doing what all 'uber-capitalists' do, ie, maximise their return on outlay), the councils, should, of course, provide the microflats THEMSELVES. They could buy up properties and do them up, or use the old shipping container option (!), or even prefabs/chalets.

No one, as we know as a basic lesson in economics, can borrow money more cheaply than governments! At a time of deliberate Quantitative Easing where by central banks buy up government bonds with 'new' money (ie, 'bank-created-instant-money'!) (as the deputy governor of the bank of England explained on Money Box live on Radio4 on Wed!), in order to 'give' money to the government, the government should now sell specific 'Housing Bonds' as Gilts, the proceeds the sale of which should be handed to councils to create their OWN housing supply (whether buy or build is irrelevant).

By doing so, they can rent them out to their social housing tenants more cheaply (ie, at cost) than the buy-to-let profiteers, and the latter will just go out of business (and probably be grateful to councils for buying their properties from them!)(buy to let landlords are 'selling out' of the business of private market renting, as government controls are now too onerous, which should mean housing stock coming on the market - additionally, private housing builders like Barrats are cutting back on their new builds, as no one can afford them - but councils could.....)(ie, government is 'liquid' thanks to thinks like QE in a way that private individuals or companies are not!)

Add to that a total crackdown on 'housing tourists' - ie, migrants who arrive confident that they will be instantly housed with all their children, despite paying not a penny into the UK tax system, just because they 'need' a house more than someone on the waiting list with fewer/no children - plus a crackdown on 'for-profit-breeding' by limiting the number of children that can receive benefits (two per couple, and if you want more you either pay for them yourself, and to enforce that you only get child care benefits for the second child if you accept long-term contraception to ensure you don't 'cheat' the system), etc etc, and all the other ways to reduce the need for perpetual social housing (eg, government 'deposit loans' so new housebuyers can change from paying rent, to paying a mortgage, etc etc), and the UK's chronic housing problem could reduce substantially.

It just takes capital - which governments can raise pretty damn easily! - invested prudently and wisely, and some 'firm love' on claimants which provides housing for those who both genuinely need it (through no fault of their own) and genuinely deserve it (because they are British citizens.)

ET etc etc.... sigh.
Only one flaw.

Why upset the gravy train for those owning private property for the sole purpose as an investment ... both in capital gain , and the regular flow of income it generates ?

Demand / supply ... keep the demand high / supply low ... over a generation or two ( Or even more ) and ... hey presto ... a money making machine for the few with capital to invest.

Sure , any Government could ... theorectically ... borrow a couple of £ TRILLION in order to build homes ... charging a rent of , perhaps , 4 / 5% ( Based on the home's cost ) against interest on the borrowing of 2 / 2.5% ... factor in inflation type regular reviews to attract the pension funds ... but ... two major problems :

1. Workforce ... tens of thousands of skilled craftsmen / women needed ... there are already shortages in many areas.

2. Costs to administer such as scheme ... a new Housing Association several times the largest one currently in existence ... or new ones at local manor level ?

On paper , the ideal solution but ... in practice ... those with interests in keeping demand high / supply low ... including many workers pension schemes ... tend to dictate housing policy.

Pierre-Joseph Proudhon ... 1840 ... " All property is theft " ( Quote from " What Is Property ? " ) ... even had Karl Marx somewhat lost for words during that decade ! ... P-JP had a point but ... fast forward to 2018 ... not many home owners would tend to support that view.

When it comes to making money , all other considerations tend to be thrown out of the window.
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