Landlord News

LHA Cuts make Letting Unaffordable for Landlords

Em Morley - April 21, 2012

Over half of landlords can no longer afford to rent to housing benefit tenants, due to cuts to the allowance, revealed a survey by the National Landlords Association (NLA).

LHA Cuts make Letting Unaffordable for Landlords

LHA Cuts make Letting Unaffordable for Landlords

53% of landlords think that the Local Housing Allowance (LHA) reductions have made it too expensive to let to those on the benefit.

Almost half of respondents (46.9%) believe that tenants under the age of 35 will suffer the most from the changes, and around 69% of landlords claimed that they cannot see themselves renting to LHA tenants in 2015.

The cuts to the LHA has resulted in the maximum rent benefit payments reduced to the 30th percentile of local average market rents, previously it was the 50th percentile.

The age of tenants on benefits qualifying for more than a single bedroom in shared housing has also increased from 25 to 35. This will drive many more into shared homes.

Chairman of the NLA, David Salusbury, says: “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.”1