Bad news if you are a landlord renting to a tenant on local housing
allowance. One of the key changes is that any single person now
up to the age of 35 will only be able to get a shared room rent rate.
This effectively means that if you have a tenant in this age bracket on
benefits (or loses their job and has to apply for local housing allowance)
no local housing authority nationwide will pay more than a room rate.
You will only get £85.00 per week, a paltry amount, especially for
What are our options, as landlords;
1. Accept it.
2. Try to negotiate with the tenant to pay the difference (wonder how
if they are not working)
3. Give them notice – and remember any council will advise their
claimants to stay in the property until a bailiff arrives. So this
effectively means, you will need to enforce your section 21 Notice.
This you know takes time and will cost you.
If you have a tenant that is on a periodic tenancy it is probably
wise to act now, if you are planning to go for option 3. Especially,
if you did not take advantage of renewing your contracts before
The upside of this, I believe, is that one bedroom flats will start to rent at
a premium. (in my role as letting agent, I am already seeing this trend
take place, higher rents are being asked for and achieved in many areas
and in days!). So any landlord caught in this situation you may find that
they have a number of tenants eager to rent their properties, as many
professional couples look to downside in these economic times.
For those “Out of London” Landlords, if you can work with £368.00 every
four weeks for your one bedroom flat and your figures tally – you need
not do anything.
All landlords need to remember that the rules came into effect in
April 2011 and there will be a transitional period of 9 months after
the anniversary of the end of your tenancy. The Government are
stating if your tenant came from a hostel they will be exempt All
rates for all property types are affected. Check all your properties
where your tenants are claiming housing benefit to ensure you will
not fall into a shortfall for the first set of landlords who have contracts,
whose anniversary was April this year… you will start to be affected in
December this year!