In their leaflet, "Renting and Universal Credit - A guide for landlords and letting agents" the DWP says "This outdated practice – known as 'No DSS…..'" Unfortunately, it is far from outdated, landlords are reluctant to take benefits claimants for perfectly logical reasons and the list is growing.
• Our reasons are the same as those of insurance companies and mortgage providers. We need a reliable source of income to pay our mortgages and maintain our properties. Benefits claimants are higher risk.
• We are often expected to house tenants that have been evicted by the social sector, we are not given any information as to the poor rental history of these individuals. Local authorities have been forced to sell off their stock leaving us to take the poor and the vulnerable and these they reject. We are not equipped to deal with their problems.
• I accept that some local authorities like Portsmouth are doing their best to support landlords and tenants placed in a private rented sector, but they have a long way to go.
• When it comes to fixing problems with Universal Credit those affecting landlords are ignored or botched.
• Many claimants have poor money management skills.
• Far too many misappropriate the housing element of their claim. Often this is simple theft of taxpayers money.
• The Government are holding down benefits while living costs rise to force more people into work. They forget that not everyone is able to work and not everyone can find work. Tenants are having to chose between paying for food and heating or the rent. If they do not pay the rent the landlord may not be able to pay for their foodor heating, if they cannot pay their mortgage the property could be repossessed.
Before it was banned, why were so many agents operating a blatant "no DSS" (now Universal Credit) tenants policy?They were not discriminating they were making sound business judgements. Granted it was unfair on those tarred with the same brush as the unreliable.
If we are wrong here then could somebody please give me the evidence on what proportion of rent arrears repossession claims are against benefits claimants?
I can get rent guarantee insurance for tenants that meet certain criteria. Most benefits claimants do not meet those criteria. Most require the applicants income to be 2.5 times their rent. If they are on benefits it may only be 1.5 times their rent. One company, RentGuarantor, do except claimants but the premium is high and I have read the small print and I would not use them.
The DWP say "As long as your tenant gives consent, you can speak to their case manager about rent concerns. They will work with you to agree the best solution." They must be joking!
Very limited extra support may be available if your tenant consents to you discussing the claim with DWP and you find a DWP officer who is well trained and has time to deal with your problem.
If they consent at the start of a tenancy a 'problem tenant' can withdraw it at any time. The landlord is then completely in the dark and no one is aware that the housing benefit is being misappropriated.
"They say "Should your tenant fall into arrears, you can apply for those arrears to be recovered for you, as long as the tenant remains in the property." They do not say that this is aslowand painful process, you cannot normally apply until the tenant has 2 months arrears. What if the tenant 'does a runner'? Thousands of landlords are left with damaged property and substantial arrears (stolen tax-payers money) when tenants just walk away.
In one example we looked at, the housing element was £583 PCM and the rest of the benefit (all they have to pay bills and live off) was £325. Any deduction to recover arrears will leave the tenant in a sorry state and probably reliant on food banks.
They say, to cover the initial delay in payments being made, "They could borrow up to the same amount as their first estimated Universal Credit monthly payment, which could include an amount towards housing costs." So someone moving into my property having paid out all the costs of moving in can start their new tenancy in debt. Smart move DWP!
Much of what the DWP claim may be true in some cases but we are not talking about the ideal tenants, we are talking about the poor and the vulnerable, many unable to work.
Rents are sky rocketing, due to Government and Local Authority lack of understanding if not abuse of landlords and the resulting shortages of rented accommodation. (See)
The Private Rented Sector cannot be expected to fill the gap left by the sell off of Social Housing the way things are today.
This document should be withdrawn from use, it is particularly misleading if not downright dishonest. I am not alone in being very concerned that less well-informed landlords reliant on the income from one or two properties for their pension or to pay a mortgage will be led to believe benefits claimants always provide a reliable and trouble-free source of income.
It is time to be honest with landlords, taking in the poor and vulnerable and reliant on Universal Credit can work very well but there is a high chance that it will require more skill and time than managing 'working professionals' as we are inclined to call them. Most landlords only have one or two properties, they need to be aware of the risks. Larger portfolio landlords are better able to cope with a fluctuating income and additional administrative workload.
Written & oral information and advice from the Portsmouth & District Private Landlord's Association is given in good faith, but no responsibility whatsoever is accepted by the Association or it's officers for the accuracy of it's information & advice nor shall the Association be held responsible for the consequences of reliance upon such information.