Changes to Housing benefit how much will rents fall?

chucky

novazombie wrote: »

Unemployment will go up considerably there is no doubt.

But to try and reduce the huge housing benefit time bomb is much more important.

Its all very well sitting there saying "If they move they won't have jobs, so why would they want to move?" But what is the other option?

They could stay in London using nearly all of their 500wk to pay rent council tax and bills, maybe a little left over for rice and water just to keep them alive.

Or they could move far away from London (yes unemployment will go up) and have some money left over for proper food.

or they could move to zone 2 or even zone 3 and make their commute to work 30 mins instead of 20 mins.

that would be too easy and wouldn't fit the HPC/Silver ramping mindset though would it?

Kenny4315

People are just going to have to face facts that this country can no longer afford (in fact has never been able to afford), to pay such vast sums of money on a housing benefit and benefits in general. It simply isn't good business for the country as a whole. It's fairly obvious that if there is a cap on housing benefits, rents particularly in the capital will fall, private landlords may kick out there tenants but they'll struggle to find new ones due to over-supply. The end result will be that more-often than not tenants will remain where they are but on a lower rent, which would be closer to the open market rent rather than OMR plus a bit because it's easy cash, or in other words the landlord will have to back down and take what they can get. Especially when in all probability they'd have to contend with the double whammy that lower rental yields may lead to a correction in the london and surrounding area housing market, which to be honest is simply stupidly over-priced when compared to the rest of the country.

Outside of the capital and surrounding area, I don't see any significant impact as the rents simply aren't as high.

Personally I'd have cut benefits further, people will have to make do with what they can afford, rather than expecting continual handouts when often those that receive the most put the least in.

I'd love a 10 bedroomed beachside villa with a large pool and grounds in St Tropez but I haven't got the loot, why should people live in places that they can't afford on the backs of others, who often live in more modest accomodation in less desirable locations, it's simply not right. and MUST BE SORTED ASAP.

Shakethedisease

Personally I'd have cut benefits further, people will have to make do with what they can afford, rather than expecting continual handouts when often those that receive the most put the least in.

Yes because it's always good to give people a good kicking when they're down.. and then sneeringly blame them also for what their landlords charge them for a roof over their family's head isn't it ??

Because it is really is, as sure as night follows day... as simple as that. This is exactly why the housing benefit budget has sky-rocketed, and that's why there needs to be something done about it.

But it isn't about who's claiming LHA ( most of whom are working). It's about who's charging and how much as far as I'm concerned.

Big elephant in the room. And the coalition seem to have missed it somewhere ? Big mistake..

hallmark

Shakethedisease wrote: »

Yes because it's always good to give people a good kicking when they're down.. and then sneeringly blame them also for what their landlords charge them for a roof over their family's head isn't it ??

Because it is really is, as sure as night follows day... as simple as that. This is exactly why the housing benefit budget has sky-rocketed, and that's why there needs to be something done about it.

But it isn't about who's claiming LHA ( most of whom are working). It's about who's charging and how much as far as I'm concerned.

Big elephant in the room. And the coalition seem to have missed it somewhere ? Big mistake..

Utter rubbish. I live in a nice house in a decent area. If I rented it it would fetch £800 per MONTH.

£400/week is a HUGE amount of money to be getting for free. Try getting that in any other country. America for example. And that's just housing benefit, many of the people receiving it will be getting lots of other benefits too.

£200/week would be more than enough of a cap on housing benefit IMO. If you want to live somewhere that costs more than that then do what the rest of us do. Either keep wanting, or try & get a better paying job.

MrPThomas

Kenny4315 wrote: »

People are just going to have to face facts that this country can no longer afford (in fact has never been able to afford), to pay such vast sums of money on a housing benefit and benefits in general. It simply isn't good business for the country as a whole. It's fairly obvious that if there is a cap on housing benefits, rents particularly in the capital will fall, private landlords may kick out there tenants but they'll struggle to find new ones due to over-supply. The end result will be that more-often than not tenants will remain where they are but on a lower rent, which would be closer to the open market rent rather than OMR plus a bit because it's easy cash, or in other words the landlord will have to back down and take what they can get. Especially when in all probability they'd have to contend with the double whammy that lower rental yields may lead to a correction in the london and surrounding area housing market, which to be honest is simply stupidly over-priced when compared to the rest of the country.

Outside of the capital and surrounding area, I don't see any significant impact as the rents simply aren't as high.

Personally I'd have cut benefits further, people will have to make do with what they can afford, rather than expecting continual handouts when often those that receive the most put the least in.

I'd love a 10 bedroomed beachside villa with a large pool and grounds in St Tropez but I haven't got the loot, why should people live in places that they can't afford on the backs of others, who often live in more modest accomodation in less desirable locations, it's simply not right. and MUST BE SORTED ASAP.

Well said.

I agree it will only be London that will see major corrections in rents and house prices over these cuts.

GDB2222

Shakethedisease wrote: »

Yes because it's always good to give people a good kicking when they're down.. and then sneeringly blame them also for what their landlords charge them for a roof over their family's head isn't it ??

I hear you, but should people be subsidised to rent property in the most expensive areas of the city? And as for landlords, if you were renting out a £500k or £1m property in Chelsea, wouldn't you want quite a high rent for it?

novazombie

GDB2222 wrote: »

I hear you, but should people be subsidised to rent property in the most expensive areas of the city? And as for landlords, if you were renting out a £500k or £1m property in Chelsea, wouldn't you want quite a high rent for it?

There is no way these families should be have £4500wk rent paid.

Even half that is too much, so the cap will be good for the country.

Silverbull

novazombie wrote: »

There is no way these families should be have £4500wk rent paid.

Even half that is too much, so the cap will be good for the country.

Not that many families get £4500wk rent paid. This is only for central London and those that have several kids.

There are many families who get £1000wk rent paid in London. All these families will have to move when the cap comes in.

We are going to see a flood of big houses come available to rent all at the same time.

My worry is how long can the landlords afford to have them empty before the bank starts sending nasty red letters.

These Landlords would love to make these big houses into several flats and rent each one out just under the benefit cap. But to get planning consent for that will cost thousands and be very difficult.

quantic

What I do not understand is why a family would need up to £500 a week for rent, when in most parts of the country that could rent you a 5 bedroom detached house with a drive way, gardens and all the trimmings. Why is the benefits cap not based on area? I appreciate that this will mean families will not be able to live in london (which i fully agree with) but it bares little relevance to the rest of the country who will not be exceeding this anyway.

I do not understand why the new budget aims to give people out of work similar benefits to the average family income. I think it is madness that someone who is not working could get close to what they could while working.

It should be impossible for anyone who is claiming benefits (if they are not on incapacity benefits) to receive more than minimum wage.

Jowo_2

I read an article in the Spectator which claimed that the LHA caps affect less than 1% of claimants and around 10% in London and is calling for a sense of perspective on it and insisting that it is fair.

"Take a pair of teachers who have lived in a flat in Islington for a decade but want to start a family. Do you think that they can afford to rent a family home there? Of course not - despite living there for years they have to move to a cheaper area. So this isn't about singling out low income and welfare dependent people - it's just about treating them like the same as everyone else.
All this noise and fury over a cap that will save £55 million next year is ignoring the real injustice of housing benefit in expensive areas. The Joseph Rowntree Foundation did a study that showed a household in a high rent area relying on housing benefit saw an effective tax rate of 90% as they tried to increase their income through work, because of the way they lost benefits. This is why inner London, for all its prosperity, also has some of the worst concentrations of unemployment, poverty and welfare dependency in the country."

http://www.spectator.co.uk/coffeehouse/6425048/some-perspective-on-housing-benefit.thtml