Monday, 21 April 2014

Consortium hopes to protect rental income by helping tenants move

West midlands landlords pool homes to avoid bedroom tax

Eighteen social landlords in the west midlands have formed a consortium to help tenants avoid the bedroom tax.

Seven local authorities and 11 housing associations have agreed to pool at least 150,000 homes to allow tenants easy access to properties across the region.

The West Midlands Making Best Use of Stock partnership hopes this will enable people to find a house with the exact number of bedrooms they need to avoid penalties for under-occupancy. The consortium hopes this will result in fewer tenants falling into arrears due to a shortfall in their benefit. Each organisation will keep its existing lettings policy.

Changes to housing benefit introduced by the Welfare Reform Act from April 2013 mean working-age tenants claiming housing benefit with a spare bedroom will lose on average £14 each week, or £25 for two spare bedrooms.
Helene Brooks, under-occupation project officer at 19,000-home Walsall Housing Group, said her organisation estimated it had 3,476 under-occupiers who would receive a combined £2.4 million reduction in benefit payments if they remain in their homes.

‘The partnership was set up last month in response to the changes to housing benefit and the recognition that each provider in isolation won’t be able to deal with the problems that are going to arise and the threat to our businesses and customers,’ she said.

The partnership hopes to start operating by the end of this year and will seek to recruit more small providers at a stock-use conference in Sandwell later this month.

Lord Richard Best, who campaigned against the bedroom tax in the House of Lords earlier this year, said: ‘Large scale voluntary housing transfer [organisations] tend to have lots of three-bedroom properties because that’s what councils used to build, but younger housing associations have built more smaller properties. Co-operation and rationalisation of stock are good things to be part of.’

The members of the partnership are: Birmingham, Sandwell, Coventry, Walsall, Solihull, Wolverhampton and Dudley councils; and WM Housing Group, Wolverhampton Homes, Sandwell Homes, Solihull Community Housing, Midland Heart, Bromford Housing Group, Walsall Housing Group, Orbit, Sanctuary, Viridian and Accord.

It follows a similar scheme set up in March involving 20 housing associations across Merseyside.

Readers' comments (8)

  • Alpha One

    It's good to see HA's taking action on this.

    Instead of whinging and moaning about how it's not fair, they're taking action to help people avoid it.

    I suppose if concessions had been given this wouldn't be necessary, but then it may not save as much money.

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  • Rick Campbell

    One wonders, cynically, if tenants transferring to different properties with different landlords will 'attract'rents at 'affordable rents' rather than 'social rents' and, as such, under different tenancy conditions.

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  • Well, that's a turn up for the books! Real social housing in action.

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  • john green

    I think you may be on to something there Rick here in London I cant see this happening without it being a new tenancy with affordale rents and perhaps with a fixed term tenancy too

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  • My daughter as been receiving discretionary housing payment since last August which she as had to apply for every 3 months, she as always worked up until taking ill and lives in a 2 bedroomed terrace with her 10 year old dog. My daughter as tried sharing with relatives but cannot cope with her being mentally ill, we got her the smallest accomodation we could find close to the family so we can support her. My daughter is 25 and only allowed the share accomodation rate of hb which is £48.50 her rent is £80 a week. We put a claim in at end of March and have never heard anything until now, she as been turned down the council have stated she could improve her situation by cutting back on her outgoings. She as sky but as no aerial or freeview box, she as a mobile on contract which she as had for years. I have asked the council to look at this again. I don`t know what we are going to do without her receiving this discretionary and this is before the nightmare bedroom tax. These new rules are so unfair they are causing untold misery. It will drive the mentally ill over the edge I do not know what we are going to do next.

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  • How about converting a good proportion of these under-occupied 2/3-bed housing association properties into houseshares (a.k.a unlicensed HMOs) aimed at single people? As a private-sector landlord and small-scale developer who rents to young working people, I know there is a lot of demand for such property, and this can only increase if the mortgage famine and recession continue and as single people aged under 35 on benefits are restricted to houseshares.

    My perhaps unfair perception is that council housing departments and housing associations have never taken an interest in the houseshare market. As a developer and parish councillor on a planning committee I've also never seen new-build affordable homes designed with HMOs in mind: it's just small units aimed at pensioners and vulnerable adults, or family housing. That said, private developers and council planning departments in my experience are no better: the only people actively creating HMOs to meet demand seem to be designers of student "pod" housing and private renovators/BTL landlords. The latter are however in danger of becoming an endangered species as more and more councils impose Article 4 Directions and hefty registration charges, precisely at a time when HMO housing should in my view be encouraged and celebrated for giving young people housing options at genuinely affordable rents.

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  • My son lives in a three bedroom house with his partner and two little boys, Their eldest son who is 16 moved out to live with his other grandmother a few months ago. My son is claiming housing benefit and has been told that they will now have to pay 14 percent of their rent. They are now planning to have another child so that they will be able to stay in the house my son has lived in since he was 6 yrs old. My son is mentally ill and the thought of moving house is making his illness worse. Another child would mean that their benefit would increase and they would be able to stay in the house. How is this saving any government money ? They cannot be the only family thinking that this is the only option they have. I do not agree with their actions but do see their reasoning

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  • Cathrine Hawes -

    That sort of situation is why the link between housing costs and levels of benefits needs to be broken. Anyone who buys their own house assesses their level of income and buys a house in an area, and of a size, they can afford. People can't force their employer to increase their wages to cover the additional costs of buying a house in a better area, or a larger house.

    The sooner levels of benefits are set at a flat rate, the sooner the housing problems will be sorted. Housing benefit is part of the reason for the boom in house prices, and subsequent crash, and for the building of houses not being based upon 'needs based' demand.

    Benefits should be set, per working aged adult, at the minimum wage x 30 hours, and this amount should be treated as taxable income. The withdrawal rate for those with earnings could be set at, say, 50%.

    Then there would be a level playing field and people would have to live within their means.

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