I'm not sure what level of reality the Evening Standard (or whoever it was who knocked up the press release) is operating on here:
Up to 82,000 households could lose their homes because of changes to housing benefit rules, it was claimed today. A survey of private landlords by London Councils found that 60 per cent would refuse to lower rent so their tenants could stay on (1). Many said they would rather evict the tenants or refuse to renew the tenancy when it came to an end (2)...
In his Budget, the Chancellor imposed caps of £400 a week for a four-bedroom property (3) and £250 a week for a two-bedroom home. Ministers had suggested changing the rules would force private landlords to lower their rent.
But London Councils said the new caps would lead to even fewer homes being available.(4) More than 25 per cent of landlords said they could just decrease the number of properties they rented to tenants on benefits (5). Housing experts warned that tenants would either be made homeless, forced to move into overcrowded accommodation or have to move to cheaper boroughs, (6) putting pressure on services such as schools... (7)
Campbell Robb, chief executive of Shelter, added: “We are extremely concerned that so many of London's landlords say they will evict tenants who fall into arrears, while some will stop renting to claimants altogether... [the move would] add to the already significant levels of homelessness and overcrowding in this city (8)”.
1) Well they would say that, wouldn't they? And what about the forty per cent who would reduce their rents?
2) That's their choice - drop the rents to the new arbitrary figure chosen by the government; drop the rent even further so that a non-subsidised tenant can pay it; or leave the property standing empty. And Land Value Tax would discourage that last resort.
3) As I've pointed out before, we rent a nice four bed house in a nice area on the outskirts of London for a shade under £400 a week.
4) How many houses will be demolished as a result of this? None? So how does he work out there'd be fewer homes available?
5) The new maths: sixty per cent won't drop their rents, but 'more than 25 per cent' will reduce the number of properties that they rent to Housing Benefit claimants.
The old maths: a third of landlords (i.e. sixty per cent minus 'more than 25 per cent') are charging less than the new rent caps anyway, to which we add to the forty per cent who will drop their rents and we get "most landlords will quickly adjust to the cap, and rents payable by non-Housing Benefit claimants will fall slightly." What's not to like?
6) Ooh, woe is me, people on low incomes moving to 'cheaper boroughs'! I'm a Land Value Taxer - we earn what we earn and cut our housing cloth accordingly.
7) There's a fixed number of children and a fixed budget for education. Unless these 'private' landlords are prepared to leave properties standing empty, for every low income tenant who moves out, a slightly higher tenant will move in so it'll all even out. Typical NIMBY twaddle, if you ask me.
8) Right. The horror scenario is that 82,000 households move out of the expensive properties in central London and this magically leads to 'overcrowding in this city'?
Wednesday, 22 September 2010
Shroud Waving
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8 comments:
"As I've pointed out before, we rent a nice four bed house in a nice area on the outskirts of London for a shade under £400 a week."
I think that people who don't pay their own rent would say that living on the outskirts of London is not acceptable.
(As it is not THEIR money).
Anon, I'm sick and tired of The Poor Widow Bogey. That goes for Poor Widows* in subsidised housing as much as for Poor Widows in The Family Mansion.
* Or their modern equivalent, single mothers.
I rent a small portfolio of properties and the maximum rent I receive is £220 a week for a 5 bedroom house! The maximum rents are set for London and the South East but anyone renting outside those areas is usually paying a lot less anyway!
Masterful stuff, MW.
It's a simple market forces equation, surely. Realignment will ensue, but the only ones I can see possibly losing out will be landlords who don't cut their cloth to suit the available tenants. Why do the left not LOVE this idea?
SA, I'm against all these "London weightings" as well, they just add fuel to the fire. So maybe the national limit should be £220 a week?
DP, maybe all the lefties are BTL landlords?
Yep, the only people who will lose out in material terms are the slum landlords whose rents have been inflated by stupid rules.
From the left we see the usual nonsense economics - the same kind of rubbish which says that selling off council houses reduced the supply of housing: "same people, same house = lower supply". Err, no.
SW, OK, let's have a national cap of £450 a month. London is not a s*** hole, by the way.
BE, yup that's the new maths for you. Similarly, if a house is repossessed, for every family that 'loses' a home another family will be able to buy a cheaper home.
But flogging off council houses at undervalue for political reasons, and ultimately renting them back for inflated prices from slum lords was an outrageously bad deal for the taxpayer.
I will concede that i've only been there twice in my life for a total of 6 days. I was in the vicinity of Kings Cross which certainly IS an absolute s**t hole but having never been to some of the "nicer" bits then my view of London is shaped by the parts I have seen.
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