Housing Benefit changes will make thousands homeless in London alone
A new report by London Councils (the umbrella body for local government in the capital) looks at the likely impact of the coalition’s planned cuts in Housing Benefit. The Impact of Housing Benefit Changes in London, based on a survey of landlords, shows that 82,000 London households could be made homeless.
The report concentrates on the effect of the reforms on the level of rent that will be paid to landlords, and two reforms are particularly likely to reduce the rent that can be paid by HB:
- A cap on the maximum payable for each property size (£400 a week for 4 bedrooms and £250 a week 2, for instance) and
- Changing the maximum that can be paid from the 50th to the 30th percentile of privately rented houses and flats in an area.
The government has suggested that this will force landlords to lower their rents – though, as the report points out, there was no attempt to find out how landlords in London (where rents are highest) would actually respond. The report quotes evidence that the London rental market is buoyant, so landlords may not feel as pressured as politicians assume.
The survey found that:
- 60% of landlords would refuse to lower their rents.
- 77% would evict tenants who were falling short of their rent by £10 – £20 a week and 91% if the shortfall was £20 – £50.
- In London, 21% of tenants will find their HB falls short of their rent by £20 a week or more and another 24% will find their HB is £10 – £20 short of their rent.
- The DWP has calculated how many properties in each region will find that their HB falls short by these amounts. Using these figures and applying the results of the survey, the report calculates that 82,000 London tenants risk losing their homes.
In addition, the Guardian points out, up to 90% of landlords will be less likely to accept benefit claimants as tenants if the benefit rates fall, according to the National Landlords Association.