Housing Benefit: Landlords' Saviour?
	We have systems that are designed not to work…

Our housing of the homeless does not work because it cannot work, because the design is antiquated and meant for another time (and different capacity). 

Why do we not change it? We cannot change it without getting rid of it altogether – and if we do THAT, then we really are in wolf country as dependent industries, public services and thousands of people without somewhere to live rely on it.

SO, are our Councils and Government really trying to solve the homelessness problem or are they maintaining systems that merely pay lip service to the liberal ideals of the electorate?

A lot of our policies regarding homelessness stem from laws and requirements set out after the war, where there was an obvious and present critical need for housing.  There have been several updates since then but no major redrafting of the basic rights and principles.  When compounded with a massive reduction in the building of new council properties over the term, it leaves us with a system that, were it to work fantastically, it would run out of properties and options very, very quickly and then close the doors and go to a one-out, one-in system that could in no way service the need.  The existence of a credible policy on the homeless requires a system of execution and application that does not work.  It needs to be administratively drawn out and indeterminable, cumbersome and oversubscribed – or someone would need to put their hands up and admit that they cannot resolve the problem without redefining ‘Homeless’.  A real vote winner. Any takers?

I do like to keep these blogs property related and deliberately apolitical, so how does this relate to property?  Well, in the Enfield/Edmonton area, the local Council are stepping up their push for private landlords to take on housing benefit tenants.  There are several ‘incentives’ as in paying deposits and advanced rents for tenants to secure tenancies where the landlord is not prepared to allow tenants into the property and then wait 3 months to get paid, as under the normal system.  Good, you may say, and yes, you may have a point, but there are other factors to consider.  The Councils are paying high rates for this area, so much so, that landlords are fixing what they consider to be the market rate, based on the rate paid in housing benefit.  Private tenants are struggling to match these inflated prices and as a result HB is making up a dangerously high proportion of the private letting market.  As this percentage increases, the local market becomes more susceptible, or dare I say reliant, on housing benefit money and therefore is vulnerable to council policy changes, rate changes, saturation problems and whatever other ills may affect benefit payment rates.  It might even be a new Government that signals the changes.

This could, if left unchecked, present a troublesome symbiosis between the Council and the local letting market and lead ultimately to a stand-off between the embarrassment of the Council propping up the local letting industry and/or smashing a hole in it by cutting their costs or updating their ground rules.

Is anybody watching this or monitoring it, as I am sure this is a scenario being played out across the country?  As agents and landlords that would have turned their noses up at a DSS tenant only months ago, now chauffeur single mothers and their kids in their BMWs while they make their choice from a selection of previously unobtainable properties, one wonders where does it go from here?

In summary, my problem is not with the DSS tenants’ rise in stature in my local letting market, no, people are people; my worries are with the increasing percentage of the local properties let at such high rents, through a single source during a time of recession.  Is it reliable and is it sustainable?

The advice I have given to my landlords is not to expose themselves too much to this area of the market.  If all of your properties are through housing benefit, then an adverse change affects everything you do.  Common sense should win out and although often difficult, in many cases, it is better to go down the guaranteed rent route or take a little less from a private tenant, maybe, to manage your exposure.

Let’s see how it pans out

Pasco

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