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Snapshot survey – the final results

So we’ve crunched the numbers from our mammoth mystery shopping exercise to see what the market looks like for people looking for private rented properties with housing benefit.

We had some final responses in, and have broken down the figures by property size.

It’s a shocking picture.

We did a snapshot survey of 1585 properties in total, advertised on Gumtree and Rightmove in Hackney on one day, of which 142 were within housing benefit limits for self-contained accommodation, and 14 of those properties had landlords willing to rent to housing benefit tenants.

That’s 9% of properties within the 30th percentile rate – this rate is set so that about 30% of properties should be available to someone claiming housing benefit.  But the rate was frozen in April 2012, and real private rents have continued to rise in Hackney.

And out of all the properties we looked at, under 1% were both within the limits and with a landlord willing to rent to a benefit claimant.

When we looked at just the family-sized properties (properties with two bedrooms or more), the picture was even worse.  Out of 1090 family-sized properties (from two to five bedrooms), there were just 36 properties (3%) within the limits and five of those (0.5%) with landlords willing to rent to someone on housing benefit.  We had all sorts of responses, from ‘No DSS’ outright on the advert, to people saying they didn’t work with the council, it was their personal preference, they didn’t like housing benefit tenants.  Many landlords said they would rent to working people only, seemingly unaware that many people claiming housing benefit are actually in work.  When we did find landlords willing to rent to housing benefit tenants, there were some uncomfortable questions being asked at the outset, in one case about nationality and family type.

We also looked at applying shared accommodation rates to the properties we surveyed, which are lower than the rates for self-contained accommodation.  There was only one within the limits (£92.35 per week for most of Hackney).  Shared accommodation housing benefit rates are paid to single people under 35 in the private rented sector.

Other interesting trends were some surprising business models springing up to make money out of the scarcity and difficulty facing prospective housing benefit tenants.  One advert linked to a site which asked for a registration fee in order to access properties available to housing benefit tenants, with adverts for high-interest credit to raise the required deposit and rent in advance that everyone must pay in order to secure private rented accommodation.  Another company linked through from Gumtree was advertising the provision of a deposit for a hefty non-returnable fee.

So for anyone in receipt of housing benefit and looking for somewhere to live in Hackney right now, prospects are looking pretty daunting at the moment.

Discussion

9 Responses to “Snapshot survey – the final results”

  1. This is excellent work, well done!

    Nothing surprising – if anything, it’s probably worse than I suspected

    Will you be putting your research together into a paper or briefing? It certainly looks like something that should be used and is most definitely 100% more accurate than the type of off-the-cuff assumptions I have heard Grant Shapps and his ilk make when referring to the rental sector in London

    Good bit of work. Thanks

    Posted by Patrick Torsney | 5 July 2012, 8:11 pm
  2. I take somewhat issue with your comments on Private Landlords. As a landlord myself we often come under attack for not accepting or restricting Housing Benefit applicants. Often there is no discussion with Local Authorities, I have often found myself banging my head against a wall trying to get the simplest points over. Perhaps if the Local Authorities dealt with the following issues then Landlords would be far more willing to accept Housing Benefit tenants.
    1) Payment in arrears – obviously as this is unacceptable in the Private Rental sector a Landlord is going to look for a tenant that does not pay in arrears which often come to 3 or 4 months
    2) Landlord obligations for direct payment – putting the onus on Landlords to have knowledge about their tenants personal circumstances and making the Landlord responsible if the tenants circumstances changed by claiming back rent paid from the Landlord is both ridiculous and surely goes against the expectation of privacy that a tenant should expect from their Landlord
    3) A Landlord is unable to get any communication from the LA – there are often cases where a tenant perhaps does not really understand all the in’s and out’s of direct payments, what documentation they need to get and how to make sure arrears are paid quickly. Yet the LA refuses to have any communication with the Landlord even when the tenant gives permission.
    4) No deposit – an obvious one as no restitution if there is damage
    5) Buy to Let Lenders insurance – often precludes renting to tenants claiming for many of the above reasons. If the LA worked in a manner of how Private Sector rentals do then that insurance mandate would be lifted which has been advised time and again by insurance companies.
    6) Payment bi-weekly or 4 weekly – English Tenancy Law states that Assured Shorthold Tenancies have to be in 6 month lengths. Most are 6 or 12 months long with payments due monthly. Thats the law, yet Local Authorities do not pay the rent like this. Of course this is detrimental to a Landlord and also confusing to tenants who have to deal with it.

    I could go on, my point is that if Local Authorities took a good look at how they deal with Private Landlords and actually took on their concerns and viewpoints then the problem would be far less,

    Posted by ClockEndBoy | 6 July 2012, 9:01 pm
    • Thanks so much for your comment – it’s really good to hear more about the reasons why landlords are in large numbers choosing not to rent to people in receipt of housing benefit. It’s clear that there are many reasons for this and we are keen to understand them. Our snapshot survey captured figures which weren’t otherwise available about the number of properties within new housing benefit limits and within those, how many landlords are willing or unwilling to rent to housing benefit tenants. There is ongoing research into the impact of the changes on landlords and decision-making (early findings here), and we hope that these issues will be taken into account by policymakers. We also heard from a landlord on twitter, who said that their mortgage policy wouldn’t allow them to rent to people claiming housing benefit – it would be really interesting to find out which mortgage lenders apply these rules to their customers.

      Posted by admin | 8 July 2012, 9:28 pm
      • Maybe it’s just my reaction to your last comment, but I just read it (as I have read many others on homeless charity websites etc) that your next report would then make mortgage lenders out to be part of the problem. Landlords in the most part, especially professional landlords, fully support the Council of Mortgage Lenders in doing this UNTIL the LA’s change the way they pay housing benefit to landlords and the way they communicate. To those of us that work in the sector the simplest solution is for LA’s to work as per the Private Rental sector which incidentally is how English Tenancy Law works……

        Posted by CLOCKENDBOY | 10 July 2012, 9:39 pm
        • We’re keen to look at all the reasons why landlords in the private rented sector are choosing in greater numbers not to rent to housing benefit tenants, including local authority practices and legislation that affect the way housing benefit is delivered. So all thoughts and comments on practices by any party that affect this market are very welcome. Thanks for your comment!

          Posted by admin | 12 July 2012, 12:55 pm

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  1. [...] The findings are remarkable and depressing. They found 1,585 properties for rent in Hackney on that day. Of these, only 143 were affordable within housing benefit limits. That’s bad enough. But they also found that of these properties just 14 – or under 1% of the available pool of homes – had landlords who were willing to rent to people on housing benefit. [...]

  2. [...] to rent to a family using housing benefit to pay part of their rent – Hackney CAB have found that only one per cent of properties in their area were affordable to and willing to accept those claiming housing [...]

  3. [...] findings are remarkable and depressing. They found 1,585 properties for rent in Hackney on that day. Of [...]

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