Up to 82,000 people could lose their homes as a direct result of the changes to the housing benefit rules.
It has been claimed today in a survey of private landlords carried out by London councils, that 60% of them will refuse to lower rents so that their tenants would be able to stay in the property. In fact many say that they would rather evict or refuse to renew the tenancy when the current one ends.
The Coalition Government announced the changes to the local housing allowance in June. The new rules are part of the governments plans to save money and stop people on benefits renting properties in expensive areas. In his first budget, the Chancellor put caps of £400 per week for a four-bedroom home and £250 per week for a two-bedroom property. It had been suggested by some ministers that changing the rules would force private landlords into dropping their rents. Property owners with landlord insurance know that their houses will not be empty for long if they do evict a tenant, as the rental market is booming. Many are determined not to be bullied by the powers that be.
London councils claim that the new caps would lead to fewer homes being available. Just over a quarter of landlords said they would just decrease the number of properties that they would rent to anyone on benefits. However, housing experts warn that many tenants would be made homeless, some will be forced to move into accommodation which is overcrowded and some will have no choice but to move to a cheaper borough which will put pressure on services such as schools.
Many are worried that tenants being forced out of their homes will only add to the significant levels of homelessness and overcrowding in the capital. London councils are lobbying the Coalition Government and asking for councils to have more power so they can refuse to pay landlords who are making a profit from housing benefit.
London councils housing spokesman, Sir Steve Bullock, said “Cracking down on the worst excesses of a small minority of landlords is welcome. However we must make sure that any action that takes place does not have the devastating side-effect of pushing poorer people in the capital out of their homes.”