Wednesday, June 23, 2010
Housing Benefit requires further pruning
It was quite pleasant to see George pander to the mouth foaming Daily Mail set yesterday by announcing a scaling back of housing benefit. He even quoted that some families are currently receiving £104,000 a year. Or rather, their landlords are.
However, greater savings can be made by clamping down on the piss taking that goes on unchecked by landlords.
I have mentioned in the past about the 'separate markets' that the letting industry enjoys, courtesy of the hard pressed tax payer. I suppose it's symptomatic of the whole private versus public sector ideology, the public side being expensive and riddled with red tape. (Obviously).
The private side of the lettings industry relies on genuine market forces. The 'you get what you pay for' and 'supply and demand' rules apply.
However, when housing benefit comes into the equation these basic rules are tossed out of the window. Rents have been artificially inflated over many years on properties which, to be quite frank, would never be offered for let on the genuine 'private' market.
Landlords know that the rent they demand will be paid and they always have a client base as their tenants would never consider renting a house that requires a deposit, as they don't have the money. The two examples below of houses aimed at this market have no deposit and if you click the streetview option you can see the type of area that these houses are typically located. The target tenant base is usually from around the same area and want to be near their families.
Have a look at these examples - here and here
For a better idea of the area these houses are located in and in order for you to understand the difference between the private and housing benefit markets, have a look at the local shops here.
Have good look round. Would you pay the rent demanded by the landlords? Neither would I.
Compare it with this example. Aimed at the private market, it requires a deposit which eliminates it from the clutches of the housing benefit mob. Similarly priced, but much nicer house and area.
I'm sure if you had a look in your local paper or had a look online, you would see plenty of comparisons in your area.