Landlords Prefer Renting Out to Benefit Claimants

Latest Landlords Panel report, presented by the BDRC research agency suggests that more UK landlords, operating in the residential property sector, are renting their properties out to housing benefit claimants. As landlords suffer an increase in the cost of buy to let mortgages and a decrease in their availability, UK tenants find themselves under increasing financial pressures. That is why, many landlords prefer to eliminate the risk of arising rental arrears and, as a result, rent their properties out to benefit claimants. The figures show that the number of properties rented to benefit claimants has increased from 9% in the fourth quarter of 2008 to 20% in the first quarter of 2009. However, those landlords who prefer not to accommodate benefit claimant have listed the following reasons, which deter them from this group of tenants: 1.    Lack of trust for tenants to look after the property (24%) 2.    Bad experience (15%) 3.    Lack of trust for tenants to pay the rent (10%) BDRC asked the landlords what reassurances they will accept to start renting their properties to benefit claimants as this is considered to be crucial in the times of the economic downturn, when Councils find themselves unable to provide all housing benefit claimants with proper social housing, which makes them turn to the private sector. 30% of all buy to let landlords claimed that the top priority reassurance would be the reform of the current Governmental policy of paying the benefit directly to tenants. One of the survey respondents mentioned that as the Government is paying the money directly to the tenant, the landlord cannot see it, which puts him or her under the risk of rental arrears. BDRC Director, Mark Long added that the group’s research also showed that although almost 50% of all UK buy to let landlords wish to increase their rents in order to improve profitability, they clearly understand that it is not the best time to do so. He also said that the results of the research indicate that those landlords, who prefer renting out to DSS benefit claimants, are taking the opportunity to increase their profits despite the warnings of the landlords who have had bad experiences in the past.