Renting and housing benefit

Myci85

My advice would be to prioritise taking a job, any job for now, be that supermarket work, cleaning, care work etc, so that you have an income, and then assess your situation again. 

There are pitfalls, but yours may be a scenario where shared ownership makes sense. You could sell your flat, use the equity to buy shares in a house, as much as you can afford, and then pay rent on the rest. This would mean you have a more secure home than renting, but you would still be able to claim housing benefit to help pay the rent. None of the pitfalls of becoming a landlord, and you don't risk spending all the equity you saved up on paying rent. 

Ratkin007

You may want to consider seeking benefits advice/assistance. 
with severance I'm assuming redundancy. I've not kept up with benefits but I remember always being told of people living off their redundancy and then trying to claim benefits and having difficulty when they should have applied for benefits from day 1, as their redundancy payment did not affect their JSA.  I believe there is a new style JSA, which can possibly be claimed alongside universal credit. 
In relation to renting out your property, if you know about being a landlord then fair enough, however it is not a good idea if you do not.  There has been and continues to be so many changes which landlords struggle to keep up with.  One of which is property licensing, for which financial penalties can be served if a property is required to be licensed but is not.  It also seems that if you ended up with a tenant that was late paying their rent or didn't pay their rent, you would end up in greater difficulty.  

Sorry for being so negative, but just some of the things to be aware of.  You don't want to end up in a worse situation out of desperation.