Interesting Links for 06-01-2014

[andrewducker]

• One of Britain's best-known landlords has issued eviction notices to every tenant who is on welfare
  (tags: welfare uk housing )
• Where The Wild Things Are - Early DISNEY CG Animation Test
  (tags: animation disney 3d art video )
• Why we should give free money to everyone
  (tags: economics society poverty welfare GuaranteedIncome )
• Fantastic, well-

Comments

[xenophanean]

The landlord's decision does make financial sense, it may not even be the most immoral way of doing it, as they clearly wanted to highlight the situation rather than just slowly changing the situation to hedge out benefits claimants (It's still a pretty nasty thing to do though).

Housing Benefit pays to tenants, which means it's already hard enough for landlords to extract it. With the government getting ever keener on making sure that tenants don't get enough to pay their rent, it is likely to become simply impossible for many clients to pay their stated rent. The system looks less and less trustworthy to landlords, as the government tries to pull more and more punitive non-savings (homeless people are *expensive*) out of it.

It's an awful situation but it's caused by the government's ludicrous policies. I don't get why they are doing this, homeless families on the street, and children being put needlessly (and expensively) into care is an ugly outcome.

[a_pawson]

Is the housing benefit paid to the tenant nowadays? It's been about 15 years since I was unemployed, but back then housing benefit was paid directly from the DSS to the landlord, which presumably made it about as reliable source of income as a landlord could get.

[xenophanean]

No, Blair changed it, he thought that long term tenants getting used to not having to pay their rent bill wasn't good for their long-term chances of becoming responsible workers. He even introduced a scheme whereby Housing Benefit was flat-rate, so that claimants who could find cheap accommodation could get extra money for having done so (all since altered to the claimant's massive detriment, a shame as it was actually quite progressive).

From a landlord's perspective though, this was disastrous, it meant that many of their previously stable tenants were wont to hold on to the money for a while, or the worst of them, not pay at all.

[steer]

I wonder if this varied by council, changed about a lot or if my memory is flakey. I haven't claimed housing benefit since around about 1993 but I thought then it was paid to the tenant (me). I remember it didn't come close to covering all the rent.

[xenophanean]

Yeah, it changed in about 2002

[steer]

And then changed back? Or am I hopelessly confused? Someone was saying the situation now is that it is paid to tenants not landlords (which is what my recollection was but I may be wrong).

[xenophanean]

Sorry, didn't read correctly. I think in the old days it was quite easy for the Landlord to get the rent money (though it may not have been automatic, can't remember), it's now (after 2002) very hard indeed, they need to provide proof of stuff. Thinking about it, the change was probably more like 2004, it's been a while.

[andrewducker]

Yeah, 94 I was definitely having my rent paid directly to my landlord.

[danieldwilliam]

Aye - if I owned a very large number of houses that I was renting out I’d be anxious about being over exposed to tenants who are paying the rent through housing benefit and whose ability to pay rent is decreasing.

[del_c]

Anyone who owns a very large number of houses and is anxious about it is welcome to come to me. I will take some of their burden on.

The very least they could do is sell one and use the money to treat themselves to a nice holiday until they're less anxious.

[gonzo21]

I'm not sure about his statement about rents going north and benefits going south though.

Interest rates remain at record lows, making it still very cheap for people to hold mortgages on properties they are letting out. So where has his overheads increases come from?

[danieldwilliam]

My reading was that rents (the amount they can charge private renters) are going north and benefits (the amount they can charge state-assisted renters) is going south.

(and that this trend is going to continue)

Therefore they are better off evicting all of their state-assisted tenants and replacing them with private tenants.

[gonzo21]

Right, okay yes, that makes sense. Particularly as government will be capping housing benefit.

I wonder if he's charging people more in rent than they'd pay on a mortgage.

[danieldwilliam]

Well, how else would he be making any money?

[gonzo21]

Oh I'm sure he has never been at risk of making a loss. :)

[danieldwilliam]

Well barring

- a signficant and sudden change in interest rates causing a cash flow crisis
- a signficant long-term change in the economic situation around Kent
- a major change in government policy on house-building
- a massive long-term fall in house prices generally
- significant changes to the regulations covering buy-to-let

they are probably looking at a fairly low risk business. The returns are probably pretty stable and capped (ish) and growth opportunities limited.

If only we could find a way to persuade them and those like them to take on the higher risk of building some of the houses they rent out.