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Charities and landlords criticise benefit change

The prospective dilemma facing investors holding residential property insurance and their young tenants in the coming 12 months just will not go away, and now an organisation created to look after the interests of landlords is letting their voice be heard.

Shared accommodation rate now applies to under 35’s

The National Landlords Association (NLA) has backed up concerns voiced by housing charities such as Crisis and Shelter who say the impending change in the shared accommodation rate of benefit could lead to thousands of young people being made homeless. The changes will come into force next January and specify that any single person claiming housing benefit under the age of 35 will only be paid the average rent charged for a room in a shared property. The drop in benefit rates could mean many landlords will find themselves letting out property to tenants who can no longer afford to pay the rent.

Survey reveals the problem

Although the changes don’t come about till January the change is already having an effect. Crisis and Shelter’s prediction that private landlords will refuse to take on single tenants under the age of 35 has been corroborated by a survey carried out by the NLA. The survey asked landlords who already let properties to tenants on housing benefit what their future plans would be in regard to whom they let their properties out to. Almost a third said they had already stopped offering new tenancies to people claiming Housing Allowance. Less than 1% said they intended to take on more and it’s fairly plain to see why.

Landlords can afford to look elsewhere

The risk for landlords who are always keen to avoid property insurance claims is just too much and the survey indicated they would advertise elsewhere to find new tenants. In the current situation they should not encounter too many problems. Tenant demand all over the UK is proving to be extremely strong in the current financial climate. The NLA also backed the housing charities on their assertion that there are definitely not enough shared properties in the country to house the number of people the change in benefit will affect. The Welfare Reform bill still seems to have some way to go before it satisfies its many critics, from both sides of the fence.