An interesting take on what is in reality a stealth tax.
The NHF article here last week by David Orr gave a figure of 180,000 underoccupying 2 bed properties yet it also pointed out there were only 68,000 or so 1 beds let in the previous 12 months.
180,000 into 68,000 cant go.
The options: -
(a) stay put and have your HB reducedd by £13 per week - which is a 17% cut on the national average HB in-payment
(b) 68,000 of the 180000 downsize into social housing 1 beds and the other 112,000 downsize into PRS accommodation.
Yet LHA only covers 69% of the rent as a natiol average and so option (b) would incure more cost from the benefit of the tenant.
Option (b) would also see a £64m per year increase in overall HB cost to the public purse given the much higher LHA paid for a 1 bed PRS property compared to a 2 bed social let.
So, the obvious choice is option (a) which would see the underoccupying tenant (aka the freedloader) keep their greater space but have to find £13pw out of their other benefit / pension / savings to do so.
Of course there is an option (c) the new RTB. Subject to mortgage provision the underoccupying freeloader would then also become an aspirational to be applauded and lauded home owner overnight!
They would also free up - at least according to Shapps - the resources to social landlords to bring on line a new affordable home, which is priced at a rent level of 80% of the gross market rent (now £205.40 per week) would be £164.32.
Thats a win-win according to Shapps. Yet hides the fact that the new social housing 'affordable' rent of which all is covered by HB would be £164.32 rather than the current social housing average of £76.16 - a mere 116% more than the current rent.
170,000 new AR homes will be developed says Shapps (Im ignoring the 100,000 extra new RTB replacements or is it 200,000?) And so 170,000 new social rents at the AR level and assumign that 66% on HB would see the HB rise by £516m per year!
Thats a better 'window' to see what the HB reforms and Affordable Rent will bring.