Monday, February 01, 2010
Housing Benefit and Shared Houses – More Pesky Government Meddling
Welcome to this weeks blog - a whole day early.
Well, the current government sure likes to meddle in the private rented sector - which, of course, keeps writers and consultants like me very busy indeed.
In the latest move, Housing and Planning Minister, John Healey MP has announced plans to tackle anti-social behaviour and property standards by requiring landlords to get planning permission before turning a property into an HMO or house in multiple occupation for the first time.
Also, they have announced plans to make it easier for local authorities to introduce licensing schemes.
Odd Move
The plans to require landlords to get planning permission before turning houses into HMOs, strikes me as rather odd because when the plans were first mooted they were rejected by a pretty broad lobby consisting of organisations as diverse as the National Union of Students and the British Property Federation.
The National Landlords Association said, “If the Government was really interested in dealing with anti-social behaviour and property standards in the small minority of places where they are an issue, they would have taken up the NLA's call for more targeted local management action by councils working with landlords in their areas.”
They went on to say that these measures could lead to “A 'nimbys charter', creating no-go areas for landlords, students, young professionals, low income families, migrant workers and a wide range of other groups who rely on private-sector shared housing.
I agree.
Not Enough Low Cost Housing
Surely, the government should "go back to the start" and look at why more people are living in shared houses.
And the answer is that as the population has grown faster than housing supply and there are just not enough houses for people to live in.
Doh!
And as we aren’t building enough low cost social housing, people who need a home are looking to the private rented sector to provide it.
“Simples!” as the Meerkat would say!
New LHA Arrears Guidelines
And of course, increasing numbers of tenants now get their private sector rent paid by housing benefits (or Local Housing Allowance as the new flavour is called.)
Still, there was one bit of good news on that front.
The government has just changed its Local Housing Allowance (LHA) guidance on rent arrears and payment to landlords.
Local authorities can now pay LHA direct to landlords when tenants are contractually 8-weeks in arrears, rather than waiting until 8 weeks have physically passed.
This change takes into account the situation when rent is due in advance.
So, it means most landlords (whose tenancy agreements require rent in advance) will only have to wait 4 weeks.
Housing Benefit and the Press
Of course, the likes of the more right leaning press (when they are not getting cross about inward migration and hook handed clerics) get themselves very worked up about the growing Housing Benefits bill.
Certainly from my experience the number of people of housing benefits has grown massively.
Indeed, in my patch it is hard to find any tenants whose rent is not paid via the Local Housing Allowance system.
This is all very different to 10 years ago.
Back then, 90% of my tenants were UK nationals with the remaining 10% from countries like Ireland and Aussie and the odd Frenchman and German. Nearly all were all paying their own rent (they were not on housing benefits)
Five years ago, mass inward migration really took hold and suddenly 90% of my tenants were new migrants from all points of the world. Again, all seemed to be working. None were on Housing Benefit.
Today, 90% of all the tenants I have applying for my latest property are overseas nationals with about 75% on Local Housing Allowance - for which it seems residency qualifications are minimal. Just don’t tell anyone at the Daily Mail!
Why Many Landlords Don’t Like Local Housing Allowance
Getting landlords to let to people on housing benefits is not easy (even if the payment in many areas is at least 10% above private sector rents).
Why, because quite a lot of landlords don’t like the fact that the monies are normally paid to tenants (not direct to landlords like in the old days unless they are in arrears as explained above) so there is the risk the tenants go and spend it on something else.
The Tories have pledged to reinstate tenants choice for immediate direct payments to landlords should they win the election.
As part of my consultancy work with housing associations and local government I work to help them get more landlords to let to people in receipt of LHA / Housing Benefit them.
As you can imagine, this consulting work is in demand.
MORE ABOUT LETTINGFOCUS AND WHAT WE DO
LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling commercially published property book for the last 3 years.
Our main business is at a corporate level for organisations - both public and private companies.
We provide consultancy for banks, local authorities, social housing providers and other organisations – helping them with their landlord facing or buy to let product strategies and services.
OTHER WORK
We also write for property websites and are regularly quoted by the media. In addition, we have written articles for numerous publications including The Independent, The Telegraph and quality landlord websites.
MENTORING
For private landlords, we also find some occasional spare time to help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on either a one to one mentoring / coaching basis or through our occasional group seminars.
Unfortunately, in the UK today, property advice in the UK is still largely unregulated and what counts as “good advice” is too often more about making the promoter money than giving useful information to the investor.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it. We also show you how to manage tenants properly.
AT OUR WEBSITE LETTINGFOCUS.COM:
THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
For general info on our CONSULTING click here: Consultancy and Seminars
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!
IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR TO OUR WEBSITE?
IF YOU SELL SERVICES TO LANDLORDS, YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!
See our Twitter page: http://twitter.com/LettingFocus
Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.
TO VIEW RELATED POSTS select a “Category” at the bottom of this page.
WANT TO ADD A COMMENT OR VIEW OLD COMMENTS?
To add a comment or view other people's comments on this post, simply click on “link to this post.”
Well, the current government sure likes to meddle in the private rented sector - which, of course, keeps writers and consultants like me very busy indeed.
In the latest move, Housing and Planning Minister, John Healey MP has announced plans to tackle anti-social behaviour and property standards by requiring landlords to get planning permission before turning a property into an HMO or house in multiple occupation for the first time.
Also, they have announced plans to make it easier for local authorities to introduce licensing schemes.
Odd Move
The plans to require landlords to get planning permission before turning houses into HMOs, strikes me as rather odd because when the plans were first mooted they were rejected by a pretty broad lobby consisting of organisations as diverse as the National Union of Students and the British Property Federation.
The National Landlords Association said, “If the Government was really interested in dealing with anti-social behaviour and property standards in the small minority of places where they are an issue, they would have taken up the NLA's call for more targeted local management action by councils working with landlords in their areas.”
They went on to say that these measures could lead to “A 'nimbys charter', creating no-go areas for landlords, students, young professionals, low income families, migrant workers and a wide range of other groups who rely on private-sector shared housing.
I agree.
Not Enough Low Cost Housing
Surely, the government should "go back to the start" and look at why more people are living in shared houses.
And the answer is that as the population has grown faster than housing supply and there are just not enough houses for people to live in.
Doh!
And as we aren’t building enough low cost social housing, people who need a home are looking to the private rented sector to provide it.
“Simples!” as the Meerkat would say!
New LHA Arrears Guidelines
And of course, increasing numbers of tenants now get their private sector rent paid by housing benefits (or Local Housing Allowance as the new flavour is called.)
Still, there was one bit of good news on that front.
The government has just changed its Local Housing Allowance (LHA) guidance on rent arrears and payment to landlords.
Local authorities can now pay LHA direct to landlords when tenants are contractually 8-weeks in arrears, rather than waiting until 8 weeks have physically passed.
This change takes into account the situation when rent is due in advance.
So, it means most landlords (whose tenancy agreements require rent in advance) will only have to wait 4 weeks.
Housing Benefit and the Press
Of course, the likes of the more right leaning press (when they are not getting cross about inward migration and hook handed clerics) get themselves very worked up about the growing Housing Benefits bill.
Certainly from my experience the number of people of housing benefits has grown massively.
Indeed, in my patch it is hard to find any tenants whose rent is not paid via the Local Housing Allowance system.
This is all very different to 10 years ago.
Back then, 90% of my tenants were UK nationals with the remaining 10% from countries like Ireland and Aussie and the odd Frenchman and German. Nearly all were all paying their own rent (they were not on housing benefits)
Five years ago, mass inward migration really took hold and suddenly 90% of my tenants were new migrants from all points of the world. Again, all seemed to be working. None were on Housing Benefit.
Today, 90% of all the tenants I have applying for my latest property are overseas nationals with about 75% on Local Housing Allowance - for which it seems residency qualifications are minimal. Just don’t tell anyone at the Daily Mail!
Why Many Landlords Don’t Like Local Housing Allowance
Getting landlords to let to people on housing benefits is not easy (even if the payment in many areas is at least 10% above private sector rents).
Why, because quite a lot of landlords don’t like the fact that the monies are normally paid to tenants (not direct to landlords like in the old days unless they are in arrears as explained above) so there is the risk the tenants go and spend it on something else.
The Tories have pledged to reinstate tenants choice for immediate direct payments to landlords should they win the election.
As part of my consultancy work with housing associations and local government I work to help them get more landlords to let to people in receipt of LHA / Housing Benefit them.
As you can imagine, this consulting work is in demand.
MORE ABOUT LETTINGFOCUS AND WHAT WE DO
LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling commercially published property book for the last 3 years.
Our main business is at a corporate level for organisations - both public and private companies.
We provide consultancy for banks, local authorities, social housing providers and other organisations – helping them with their landlord facing or buy to let product strategies and services.
OTHER WORK
We also write for property websites and are regularly quoted by the media. In addition, we have written articles for numerous publications including The Independent, The Telegraph and quality landlord websites.
MENTORING
For private landlords, we also find some occasional spare time to help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on either a one to one mentoring / coaching basis or through our occasional group seminars.
Unfortunately, in the UK today, property advice in the UK is still largely unregulated and what counts as “good advice” is too often more about making the promoter money than giving useful information to the investor.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it. We also show you how to manage tenants properly.
AT OUR WEBSITE LETTINGFOCUS.COM:
THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
For general info on our CONSULTING click here: Consultancy and Seminars
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!
IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR TO OUR WEBSITE?
IF YOU SELL SERVICES TO LANDLORDS, YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!
See our Twitter page: http://twitter.com/LettingFocus
Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.
TO VIEW RELATED POSTS select a “Category” at the bottom of this page.
WANT TO ADD A COMMENT OR VIEW OLD COMMENTS?
To add a comment or view other people's comments on this post, simply click on “link to this post.”
Labels: HMO, HMOs, houses in multiple occupation, housing benefit, LHA, LHA qualification criteria, Local Housing Allowance, shared houses
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