Out of all the landlords surveyed almost 60% stipulated no housing benefit tenants when advertising their properties. This data was collected from a survey of more than 1,000 landlords in the UK and was conducted by the house share service, Spareroom.com.
The survey goes on to outline that most buy to let landlords (almost 90%) that were surveyed were against the change to the benefits system that automatically pays the Local Housing Allowance to the tenant instead of directly to the landlord.
Lee Daniels, Managing Director of Helpland Limited, the national tenant eviction and landlord advisory company, said:
“The results of the survey are not a surprise to us. Over the last 4 months we have seen an increase of over 30% in instructions on serving notices on housing benefit tenants falling into rent arrears. With housing benefit caps coming into force as we speak and over the next 12 months we expect the number to rapidly increase further.
“The local authority will only pay the housing benefit to the landlord directly if there are a minimum of 8 weeks rent arrears. This could be fatal to some landlords who rely on the rental income to cover their mortgages”.
The change came to pass in 2008 and just over half of landlords who have housing benefit tenants have experienced issues with rent payments since the change came in.
The survey also asked landlords why they were not willing to rent their properties to housing benefit tenants. Almost a third said that tenants that were not on benefits were more reliable, whilst almost half (47%) said that they did not want to subject themselves to the hassle that comes with payment problems.
According to the results, the problems included late payments, damage to properties and tenants simply not paying at all. Three quarters of landlords questioned said that they would not consider taking on a tenant who is on housing benefits even if the tenant had a guarantor for the payments.
Overall, 34% of the landlords questioned said they have housing benefit tenants in their properties whilst almost half (34%) had previously done so.
Lee said:
“We have written to many local authorities as well as parliament to change the system to allow the housing benefit to be paid directly to the landlord.
"This would be seen as a massive incentive for private landlords to rent their properties to tenants claiming housing benefit and would ease the pressure currently on local authorities who are facing a negative response from private landlords
“We encourage our clients who are considering renting out their properties to Housing Benefit tenants to ensure either a guarantor is in place or a larger deposit is paid by the tenant to minimise their risk”.
