Wednesday, June 23, 2010

Housing Benefit requires further pruning

With added rusty fridge/freezer lying in back garden...

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.


Toni said...


You are spot on here. The rents that George was talking about are probably down here in London and it is a true fact. Just recently there was an issue about a woman claiming benefit for her 6 bedroom house in Brixton. She had her children, (aged up to 34) living with her and for cultural reasons they had to live together, (surprise they were muslims). The council simply couldn't find alternative accomodation in that are so paid the landlord, (also muslim), the amount he demanded.

I let a house I owned bak when I was a teenager to the council and whilest I got a good rate, the way they left the property was shocking. In the end I decided to give the house to my brother who had a family, luckily the pedantic housing authority had done a rigerous inspection prior to me letting it out to ensure it met "their standards" and in the contract it said it would be returned as it was. Well it cost8,000 quid to have industrial cleaners fix the property when the council tennants left and after a reasonably lengthy exchange of letters that nearly went to court the council paid up.

Ruda Malpa said...

Unfortunately very poor quality housing & sky high rents are not just found in areas where there are a high number of council tenants. I have seen exactly the same thing happen in the area that I live in, where we have a very high number of immigrant workers. To thier credit they don't all jump onto the council's housing lists, they actually make the effort to rent privately & pay thier own way. Unfortunately, the local landlords know there's loads of them looking for accommodation & so they charge sky high rents. The immigrants don't mind, cause they're quite happy to live together in huge numbers, thus spreading out the cost (I know of 7 adults living in a 3 bedroom house!). So, the vicious cycle continues......

scunnert said...

That's the capitalist system for ye.

Mummylonglegs said...

I hate to risk life and limb here but housing benefit doesn't actually work like that anymore. Since 2007 anyone filling in a new claim or requiring a rent increase has to go onto new rules. New rules mean that the council decide how much a house is worth and will only pay that much. New rules also mean that the money is paid direct to the renter and they must pass it on. So the only people willing to rent to dss these days are those that know the renter is going to hand over that money, aka family members (you know the sort I'm talking about here). No rental agency or private landlord will take the chance now (6 months with no rent and a costly run to court to evict the druggies) so for those on housing benefits the private rental market has all but disappeared.

Mummy x

RantinRab said...

Mummy, the council will pay the 'fair market price' which is artificially inflated by the amount of DSS claimants in an area.

The figures back my post.

Anonymous said...

Toni said
the council paid up

No, we did.

People on benefits should be housed outside London to make it more affordable and safer for those with jobs. Why would you need to be in Zone 1 if you don't work?

Nice - er - rant, Rob.

Anonymous said...

Hi Rab, Good post!

Although slightly off topic I have to say how shocked I am at the state of the shops in Morven Ave. I've been overseas for many years but my grandparents lived on Kilmaurs Rd in the 50's and 60's so I knew that area well. Everyone knows where they were when they heard about the assassination of John Kennedy, so they say. In my case, as a youngster, it was in the butcher's, which used to be situated on the far left of that group of shops.
Here's hoping for better days for the town but where they will come from how I don't know since most of the industry and factories are gone.
Killie was once a thriving town,a great place to grow up and somewhere you could be proud of but I suppose the same could be said of many other towns in Scotland.

Ex Kilmarnock man.

Anonymous said...

The rents quoted don't seem wildly OTT. I mean would you rent your house to a dolescum junkie waster without a premium to compensate for the risk it would get trashed?