Benefit cuts making letting unaffordable for landlords

National Landlords Association Logo.
National Landlords Association Logo.

A survey* by the National Landlords Association (NLA) has found more than half of landlords can no longer afford to rent to housing benefit tenants because of cuts to the allowance.

The survey showed 53% of landlords believe the local housing allowance (LHA) cuts have made it unaffordable to rent to those on benefits.

Nearly half of landlords (46.9%) believe tenants aged under 35 will be hit hardest by the changes and almost 69% of landlords say they can’t see themselves letting to LHA tenants in 2015.

The LHA cuts have seen maximum rent benefit payments reduced to the 30th percentile of local average market rents, rather than the previous 50th percentile.

The age at which a tenant on benefits qualifies for any more than a single room in a shared house has also been raised from 25 to 35, forcing many more people into shared accommodation.

David Salusbury, Chairman, National Landlords Association, commented:

“It’s concerning that so many landlords appear to be planning to withdraw from the LHA market within just three years, as they can no longer afford to let their properties to tenants at the reduced benefit rate.

“In view of the pressures on housing, the private-rented sector will inevitably play an increasingly important role in providing housing to LHA tenants, particularly those aged under 35, who aren’t able to access other housing.

“It is vital that local authorities work with landlords to provide the support services needed to help this demographic, as many are forced to move into shared accommodation.”

*956 landlords were surveyed by the NLA in February 2012