renting to housing benefit tenants

sam2015_2

What are the positives and negatives about renting property to housing benefit tenants?
What to ask for if I were to take them on?
Never had any benefit tenants so....any advise would be useful.

Mossfarr

Depends on the individuals and their circumstances.
I have tenants who are extremely hard working but in low income jobs. They both work but the husband has periods on benefits after surgery for a long term disability following a car accident. They fall behind with their rent as the benefits claims take ages to come through. As their income is drastically reduced they fall into arrears very quickly.
Having said that, they are brilliant tenants. They look after my property, they keep the large garden beautifully, they let me know straight away if there is any problems and, more importantly they see it as a home for life. I know they have difficulties but they always pay off the arrears as soon as he is back at work.
Alternatively, I have had other benefit tenants who thought the world owed them a living, they were dirty, the house stank, they completely trashed the garden, upset the neighbours and were completely unconcerned whether the rent was paid or not. They trashed the kitchen and did a moonlight owing me a couple of thousand £'s.
You just have to check your tenants out extremely thoroughly, don't leave it to an agent as they are simply not bothered as long as they get their fees.

anselld

May have difficulty to afford market rent.
Can be difficult to evict due to Council advice to resist eviction to the full extent of the law.
Difficult to persue damages against.

theartfullodger

Some 1 million working people get some or all rent paid by HB. Like most people, most HB recipients are decent:

Credit & reference check them carefully anyway & get references from current AND PREVIOUS landlord: (yourself - don't rely on applicants to produce letter).

They might fail affordability on credit check but you'll find CCJs etc..

tlc678910

Hi,
I'm thinking replies are slow off the mark because it's a minefield to answer without getting shot down. There will be the extremes of landlords that have had terrible experiences, as well as good, but also many good people that have found it very hard to get a private rental as they are discriminated against simply for being on housing benefit.

I think I would want to consider people as individuals (as varied as any others) and by that I mean being able to meet them, get a good impression and get good references from previous landlord.

Some would say "guaranteed rent" is a benefit but (from my experience of housing support) that is only the case if the tenants do the paperwork for their claim. Sometimes arrears develop because the paperwork isn't done.

Local authorities now are supposed to pay the tenants the money and the tenants pay it to the landlord, unless there are special circumstances, so it is possible that the tenants can receive the rent but not pass it on. So reference checks are important in considering whether you are likely to receive the rent.

One disappointing aspect is if people get some work their claims go haywire, they need to provide proof for a new allocation and there are delays. If their work stops the same process again so people who do not do any work (for whatever reason I'm not making a judgement on that) actually have claims that run far more smoothly than people who look for work but may get varying hours/temporary contracts. The system does not cope well when circumstances change and the more often they change the more of a mess the claim can get into.

Good luck with your let.
Tlc

Innys1

Don't do it - unless your no one else is interested in your house - even then, consider selling as an alternative. Simply not worth the risk.

bobbymotors

Innys1 wrote: »

Don't do it - unless your no one else is interested in your house - even then, consider selling as an alternative. Simply not worth the risk.

Sadly, I agree.

dekaspace

Innys1 wrote: »

Don't do it - unless your no one else is interested in your house - even then, consider selling as an alternative. Simply not worth the risk.

It's attitudes like that that cause genuine people on benefits to struggle and end up in dives with dodgy landlords.

I have been on benefits a lot over the years for mental health reasons and I have been illegally evicted 3 times, landlords always letting themselves in when they want, had uninformed viewings meaning I was in bed in my underwear, or in shower with bed unmade for them to send me emails complaining my room was a "mess" (spotless apart from unmade bed!) I have left properties in better condition than when I move in give or take shoddy workmanship (like hidden holes in wall there when I moved in which I was blamed for) landlords keeping deposit claiming I did thousands in damage despite photos of spotless properties.

Better stop but I can go on for ages.

And one of the big things is almost every place on benefits has wanted HIGHER rent and been in worse condition than the ones that take working/student tenants thats because landlords know how much housing benefit is paid so set it at that rate even if properties are worth less and in bad condition which then artificially increases rent value for all.

You get scum on benefits just as much as you get scum who work the only difference is you have slightly more chance of getting money back from court with a worker.

Sadly people on benefits get a bad repuation by a number that play the system, if anything i'd say be more worried if someone on benefits could easily afford a property to rent as if they had money to spend that much it would raise alarm bells, a more genuine one might struggle to pay rent and deposit as they live within their means and have no dodgy things on side.

The issue with claims gets misinterpreted and people just focus on the end result, when I had problems with my last 2 landlords it came down to a dispute one time about when I left my last job so they stopped my benefit till I could "prove" it and despite doing it same day as office was around the corner from my house I was waiting 6 weeks later, the claimaint may contact council multiple times but get nowhere and a landlord just gets one side of the story from council saying the claimaint hasn't handed in paperwork so the tenant gets blamed.

Another time was similar and despite me handing in information they told landlord I handed in nothing so landlord kept pestering me to hand information in and when I said I did I got a mouthful basically saying "well benefit tenants always are like this/say that" which was quite offensive really as they didn't believe me.

So the good tenants on benefits are the ones that are messed around by landlords and benefits meaning they can't afford to move as the stock of avaialble landlords that rent to benefit claimaints is low and even lower because the ones that do want more money which a genuine claimant can't afford meaning the bad claimiants get the nice properties then cause problems giving a repuation to all!

EDIT for an example a friend saw some properties with an agency that accepted benefit tenants recently lets just say the properties were filthy, what furniture there was looked so old it was falling apart, cooking facilities were rusted and coated in old burned on and fatty foods.

I went to some in the past with friends who have wanted a place as found work, for the same price they got beautifully decorated properties, much newer furniture, part or all inclusive rent meaning people on benefits can barely cover their bills sometimes.

Floxxie

sam2015 wrote: »

What are the positives and negatives about renting property to housing benefit tenants?
What to ask for if I were to take them on?
Never had any benefit tenants so....any advise would be useful.

If you have a mortgage on you house, expect to pay higher interest (and have fewer options) and have a higher premium to pay on your landlord insurance.

[Deleted User]

Another tenant who is a carer on benefits. As a carer with two sons with DLA I get more benefits than minimum income support, but obviously my outgoings are higher.

I rented a 3 bed terrace for four years through a private LL. I'd been looking daily for 3 months.., I looked again when he wanted to sell.., rents were way above LHA then, four years later (LHA £750, I've just seen rents averaging well over £1k a month for normal terraced houses). So when the LL said he wanted to sell 18 months ago, I couldn't find anywhere to move to and I looked so hard. I had been unhappy there due to LL not doing repairs, threats to evict me if I reported repairs he should be doing (central heating broke down frequently, electrics were very dodgy, damp and mould, a ceiling fell in, front door broke, draughts, the list is long) so it was a nightmare as the mother of a family who needed security. But no matter how hard I looked, I couldn't find any LL who'd take me with a place I could afford. Saving up a deposit was very difficult. Help was only available when the LL started eviction proceedings (from the council).

I had to pay £390 for the eviction proceedings and only knew where we were going after we'd been evicted. I was expected to wander the streets with goods and baggage for four hours, in spite of having autistic kids.

When my ex moved out after taking money from me, we went very short while arranging benefits to be set up. But I made sure rent was paid even though my money had been halved. It came before food and bills. (I paid it after receiving the housing benefit). I was never in arrears but benefits can be stopped with no warning and just because of an admin error. You don't have to do anything wrong for this to happen. It took a lot of commitment to pay for rent before food. But for most of this time (4 years), the money I had coming in was known and 'secure' probably more so than most employed people. My ex works as a mechanic, he can have money docked from his wages for illness and for a repair that goes wrong.., and has done. People on Zero hours contracts don't know from one day to a next if they'll be earning any money.., frequently and unfortunately, its a very popular way of employing people.

In the end I was topping up the rent by £150 a month. And I was lucky, average rents were higher in the area.

I'd not willingly rent privately again. I' probably feel differently if my LL had been more responsible and not put me through 18 months of stress while he was trying to sell the place.

I also would recommend anyone, whether employed or not should be checked thoroughly rather than credit checked by a LA. There wasn't a lettings agency here (I tried them all) who'd consider me as a tenant as they'd only take earned money through their affordability checks, yet my credit rating is good, no debts and no rent arrears at any point. I kept the house in a very good state of repair (include almost complete redecoration in the magnolia colours the LL wanted to help him find a LL buyer - and he sent round anyone who'd buy of course). I lived with frayed laminate floors but the house was repaired by me in the main unless the repair was too big for me.

I'd recommend a prospective LL goes and talks to the prospective tenant in their present home to see if they are clean and keep their place in a good condition. I'd recommend asking to see bank statements to get an idea how responsible they are with money. A previous LL can say the tenant is ok because they want to get rid of them (in arrears). Only CCJ's show up in a credit check (which I didn't have). Being employed is no guarantee that a tenant is responsible and is willing to pay the rent. It seems to me that trusting a property, which is a pretty big investment, to someone on the basis of a very basic credit check and a LL reference (which as said could be false because they're terrible tenants and the LL wants rid) is insane.

But I couldn't find a LL who'd even consider me. Yet I'd say, because of my eagerness to live in a secure home, I was a better more secure tenant than any employed person. Precisely because I had no where to go to.

I'm presently in emergency housing, under licence but it seems more secure than a private tenancy! And there's no LL visiting when he feels like it or threatening to evict me when I tell him the rotten flat roof has finally made the ceiling fall in, or the central heating has broken down yet again. At least the council does repairs. I had all my taps changed because they leaked (they were about 40 years old lol).., it was like a miracle. No arguments, they were just changed by a proper plumber.

Old_Git

I have one property that I try not to let to anyone on benefits .
My reason is half the neighbours are on benefits and I dont want the area to be a dump.

Most of my tenants have been on benefits at sometime .

My nightmare tenants worked .I advertised for a tenant in January.One working guy applied .I googled him ,he had done time for growing drugs .

I wouldnt rule out a tenant on benefits .The disabled make great tenants .