Homesure Property

A Universally Bad Idea?

Mark Loughnane

Mark is a Director of HOMEsure Property specialising in the lettings market. Mark loves talking to anyone about property, especially landlords, so feel free to call him any time for advice or a chat. Outside of Property Mark is a Widnes Vikings Rugby League fan and is learning to play the Piano.

Lord Freud & the Department For Work and Pensions (DWP) have decided to extend trial periods for universal credit, giving themselves an extra 6 months to see if it will work or not (more likely the latter).

Although a nice idea in principle I cannot see the legacy of universal credit being anything other than increased rent arrears and homelessness. The majority of private landlords already struggle to get to grips with housing benefit payments so their minds will be blown by this rebranding.

Looking through the headlines I do not believe that private landlords are actually going to be overly affected by the changes;

  • The Bedroom Tax does not affect private landlords, only social landlords.
  • DWP have performed a U-Turn by announcing that direct payments to landlords will be possible in the event of rent arrears (I am guessing that this will remain at 8 weeks’ worth)
  • Although not likely to be headline news I would imagine that the most vulnerable members of society will still have the (enforced) option to have their HB paid directly to the landlord. There are rather large homelessness prevention departments within the council who ensure that this is the case.

If anything, rather than HB being paid directly to the tenants, I can see universal credit actually resulting in the reverse. If a tenant does not pay their rent one of two things will happen;

1.       Their HB will be paid directly to the landlord as they are in arrears.

2.       They will be evicted, made homeless and therefore will be vulnerable. As vulnerable tenants their HB should be paid directly to their next landlord.

Despite all of the horror stories that are coming out with regards to the changes it would seem that everything should be just fine. As long as you either take the time to learn the process or get in touch with an agent who has been bothered to attend the relevant courses (*coughs* HOMEsure *coughs*) then you should be able to sleep at night.

As always, if you have any questions on this, please do not hesitate to get in touch.

Mark