Your tenants could be about to lose their housing benefit

Your tenants could be about to lose their housing benefit

Today (3rd March) the Government has laid regulations that will enact a long-delayed manifesto commitment to restrict the housing costs element of Universal Credit that 18-21 year olds currently receive.

You can find the regulations in full here.

The regulations, which will come into force from 1st April 2017, remove the automatic entitlement from some 18-21 year olds. However, there are a number of exemptions to protect the most vulnerable claimants.

In the explanatory memorandum accompanying the regulations (available here), the Government argues that this action is necessary so that “young people in the benefit system face the same choices as other young people who go out to work and cannot yet afford to leave the parental home.”

They argue that this change will make the system fairer by encouraging young people who can stay at home to do so, thus alleviating a cost to the tax payer.

Exemptions are being included as the Government recognises that there will be some young people who are unable to stay at home. These exemptions include:

  • the claimant is an orphan or their parents live abroad
  • the claimant would be at serious risk of physical harm if they remained at home, or
  • it would be inappropriate for the claimant to live in the parental home including where there would be a serious risk to the claimant’s physical or mental health.

The regulations will also not remove the entitlement from vulnerable claimants including those that:

  • are responsible for a child or a qualifying young person
  • were a care leaver before reaching the age of 18
  • receive the care component of disability living allowance at the middle or highest rate or the daily living component of personal independence payment
  • has been a victim of domestic violence, or
  • is in temporary accommodation provided by a local authority.

Read more about the details of the regulations, and the various exemptions here to see if they could impact on your tenants.

Commenting on the Government’s move to restrict the automatic entitlement of 18-21 year olds to claim housing benefit, Richard Lambert, Chief Executive Officer of the National Landlords Association said:

“The Government has effectively closed the door to private rented housing to some of the most vulnerable individuals in society. 

“Never mind the nuances, all landlords will hear is that 18-21 year olds are no longer entitled to housing benefit.  Faced with a young person who may not be able to pay the rent, a landlord won’t worry about the details of their life, they just won’t consider them as a tenant.

“However much the Government tries to make this policy more palatable by talking up the exemptions, it still leaves a nasty taste in the mouth.”

3 thoughts on “Your tenants could be about to lose their housing benefit

  1. I am astonished that Mr Lambert thinks his (professional) members are so crude and careless of their clients. There is no endless pot of money. As a Professional Landlord, manager of an affordable housing group, of over 25yrs I see no reason why anyone should pay for young people to have their own flat without adequate income to pay for it simply because they want one. Indeed this is not a new initiative – Several London boroughs at the turn of the century restricted under 25yr olds to bedsit accomodation only if they were unable to live at home! It cut the benefits bills by many millions of pounds. The youngsters were still housed, and they learned a valuable lesson – Benefits are not there for the taking. If you want a decent life and standard of living you need to go out to work to earn it, The benefit system is ther for emergencies and to help when needed, Not ad nauseum. Not out of preference.
    We house at risk &,orphaned youngsters etc put forward, & supported by our local councils. We will CONTINUE to do this!
    Having watched and worked in the housing market for over 30 years the problem is not the restriction of money, it is the stultifying and expensive changes to the housing stock available. Where are the (decent) bedsits to house the young people on low incomes? Where is the new stock coming from? Where are the houses in multiple occupation to take up the housing slack coming from ??

    I could go on for hours and hours, but Id better stop ranting. Suffice it to say, I abhor the majority of buy to let landlords that i have met in my career – they appear to only want maximum income for minimum expenditure, have little interest in the longterm care of their buildings, consider us mad for committing 25% of our annual rental income back into our properties as maintenance & improvements,& see no point in capital repayment mortgages.

    A government that wants to better control the housing market could alwyas consider doing away with interest only mortgages ! That would sort the wood from the trees.

  2. I do not know what world Niki lives in! I have a portfolio of property and all re on interest only mortgages. I take on benifits claimants referred by the local council (80% on benifits) Who pays for the damages/devastation of our properties caused by the so called at risk and similar tenants? Almost every benefit tenant having to be evicted costs between 2000 and 5000 ponds to put the propertty back on the market. Yes I have decided to sell up and just keep properties I can pay in full for. Unfortunately the dreams of expanding my portfolio are now just dreams. Cannot afford to pay the extra 40% on the interest paid! Yes this will mean lots of drug addicts, alcoholics and property destroyers would not be housed by me!
    Any sensible Landlords trying to run house renting as a viable business will have to think twice.

  3. Homeless will increase, this government has no idea of the real world, be it housing or self employed or operating with commercial properties.
    It can still provide millions in Aid to countries that either don’t need it or has a chunk of it taken by its rulers.
    Send all the aid to the starving counties and control it with the armies of the world. Lets start a War…..On famine

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