BS: UK Housing Benefit cuts

Subject: BS: UK Housing Benefit cuts
From: Arnie
Date: 04 Jan 12 - 05:52 AM

A big debate on local radio today about the Govt's housing benefits cuts coming into effect this month. Somewhat predictably the callers fall into two schools - those who think that benefit recipients are a bunch of scroungers living off the backs of the workers, and those who think the Gov't should be doing more to provide cheap housing for the low paid & unemployed. One caller, a Citizen's Advice Bureau advisor stated that thousands of families would be forced into even more poverty and most would have to move to cheaper and unsuitable accommodation, if any were available. I suppose that something had to be done as we read of large families on benefit living in mansions in Chelsea & Kensington costing the taxpayer up to £250,000 p.a. This is a somewhat extreme case but there are quite a few others in the London area not far behind this figure. What none of the callers has touched on however is the role of the landlord. The landlords are making a mint by charging high rents in the knowledge that the Gov't in the past was happy to pay the asking price. Why not set rents at a lower, more sustainable level backed by statute? It suits these landlords for the Gov't to be seen as the villain of the piece, but it is their greed that has caused this problem. In fact it is not really a problem at all if the landlords simply said ' ok, I'll take a few £'s less rent so that this family can stay in decent accommodation'. We're not talking hundreds of £'s a week here, just £20-30 in a lot of cases. Sheer greed lies at the root of this situation.

Subject: RE: BS: UK Housing Benefit cuts
From: Leadfingers
Date: 04 Jan 12 - 06:02 AM

But our Millionair Cabinet members keep teeling us we are all in this together !

Subject: RE: BS: UK Housing Benefit cuts
From: Richard Bridge
Date: 04 Jan 12 - 06:37 AM

Have you, Arnie, any actual knowledge of the rents that benefits will actually cover or the contribution (if any) that benefits will make to mortgage payments? It doesn't sound like it.

Subject: RE: BS: UK Housing Benefit cuts
From: Arnie
Date: 04 Jan 12 - 07:15 AM

RB - not rising to your bait today, or any other day come to that.

Subject: RE: BS: UK Housing Benefit cuts
From: Brian May
Date: 04 Jan 12 - 07:58 AM

Wait until it gets close to the Olympics . . . if you think THIS is bad

Subject: RE: BS: UK Housing Benefit cuts
From: GUEST,Sam Hudson
Date: 04 Jan 12 - 08:00 AM

Excellent news, if you want a nice house, work for it. The days of leeching are over.

Subject: RE: BS: UK Housing Benefit cuts
From: DMcG
Date: 04 Jan 12 - 08:47 AM

those who think that benefit recipients are a bunch of scroungers living off the backs of the workers

Many of these 'scroungers' live in private rented accommodation, so the money for the rent is taken from the 'workers', then, via the 'scroungers', put straight into the pockets of the private landlord. Oddly enough, no-one ever complains that these landlords are living at taxpayers expense and are getting money for, in many cases, doing nothing.

Subject: RE: BS: UK Housing Benefit cuts
From: GUEST,Eliza
Date: 04 Jan 12 - 08:52 AM

Sam, you're assuming that all the folk on Housing Benefit are lazy and workshy. It just can't be so, surely? Many are disabled, ill, unable to find work in their area, etc. The alternative is turfing people out on the street, taking their children into care on the way. All that's needed (IMHO) is a rather tighter assessment of needs, and monitoring of individual situations. A basic human right is so have decent housing, and not everyone can 'pay their way' as we would wish.

Subject: RE: BS: UK Housing Benefit cuts
From: Keith A of Hertford
Date: 04 Jan 12 - 08:52 AM

Many more people could afford to buy if they could reclaim mortgage interest.
Private landlords CAN reclaim it against tax, and their purchasing power pushes up prices further.

Subject: RE: BS: UK Housing Benefit cuts
From: Keith A of Hertford
Date: 04 Jan 12 - 08:57 AM

The benefit is being reduced not withdrawn.
There are many cases of working people living in far worse conditions than the unemployed.
Cases were revealed of people who had never worked living in property worth millons.
It is not a simple issue of right and wrong.

Subject: RE: BS: UK Housing Benefit cuts
From: Georgiansilver
Date: 04 Jan 12 - 09:16 AM

I guess the theory that if you take allowances away from the 'working class' people they somehow all pull together and take care of each other has worked throughout history but as we become more socially inept and lacking in community spirit.. a price has to be paid. Keeping the working man in his place has always been around in aristocratic circles and never have we felt it more than at present. During the last live quarter... Repossessions on mortgages rose by 18%..... Mr average cannot afford to buy a house in any case.. so who buys the cheaper repossessed houses that come on the market (and others at the cheaper end of the market I must add)... Landlords buy them and make good money renting them out........ so.. the rich get richer and the poor get poorer....... So what happens to all those who have had houses repossessed because they could not afford the payments If those allowances are stopped.... they will not afford the rent either so where does that leave us?....... There will be a huge increase in homeless people in the UK and a lot of people being evicted for non payment of rent... either that or close family groups will swell as homes become overcrowded when people take in their own families....... Oh and by the way.... The government are ploughing Millions into building new homes.... FOR WHOM???   It does not make sense...........

Subject: RE: BS: UK Housing Benefit cuts
From: Keith A of Hertford
Date: 04 Jan 12 - 09:35 AM

There is a great shortage of housing that makes our prices and rents so very high.
The new housing is not sufficient even to accommodate the increase in population so the shortage is still actually worsening.

Subject: RE: BS: UK Housing Benefit cuts
From: GUEST,Eliza
Date: 04 Jan 12 - 11:49 AM

I heard on the News that there are people with very large incomes occupying council houses, which were originally intended to house folk on a low income. Maybe they should be encouraged to buy their own home? Selling off the council housing stock by You Know Who was a mistake IMO.

Subject: RE: BS: UK Housing Benefit cuts
From: Musket
Date: 04 Jan 12 - 12:02 PM

Getting money for nothing?

Considering the rents I have had over the years have not yet overtaken my investment in the properties, I doubt "money for nothing" is apt here. Cutting housing benefit will not help as less people like me will invest and make housing available. Unless the government own every house that is not owner occupier, you need people to buy the properties. I don't buy into the idea that the council is a better landlord than private ones. Many people I know are carrying rent arrear debts and not acting on them, whilst I note our local council has increased their bailiff budget.

Just before anybody gets too far on a "all Landlords are bastards" kick, just a couple of things to ponder on'

if you are in a pension scheme that is funded, private or public, you are landlords, getting a return.

If you get a penny interest from savings accounts, a fund manager is buying and selling properties with tenants in them to give you your penny, (and his tuppence, but that's capitalism for you.)

This thread does highlight an issue and in the end we could boil it down to this Tory fascination with "the deserving vs the undeserving poor." Cameron's big society is all about altruism, or put another way, the poor being helped when the rich feel it appropriate.

But I feel that's another thread, although not being in control of your destiny is a good definition of poor.

Subject: RE: BS: UK Housing Benefit cuts
From: DMcG
Date: 04 Jan 12 - 12:10 PM

Considering the rents I have had over the years have not yet overtaken my investment in the properties
Are you taking into account the return of capital when you resell the properties? The appropriate comparision is return on the investment in rental properties, as compared with the stock market, government bonds etc etc, taking risk into account, rather than the initial investment. At the moment, I suspect return on investment in a property to rent is somewhat higher than a building society would give you on the same capital.

There are good landlords, but there are also others who, for example, spend nothing on maintenance unless a window or door falls out of the frame.

Subject: RE: BS: UK Housing Benefit cuts
From: Musket
Date: 04 Jan 12 - 12:58 PM

My comments were based in the tense I used. My rents have not overtaken my investments. I have not sold any properties and to be fair, if I had, balancing the ones I bought in the late '90s which would return a profit and those bought 2003 - 2005 which would quite possibly sell for less than I paid for them, then my statement would hold true in your scenario too.

Yes, I do agree that buying into property can give a much better return than banking the money. I know many people, my wife included, who paid into a long term Standard Life savings plan and might, if they are lucky, get back what they put in, assuming they carry on paying till it matures anyway. So I have no qualms over choosing property as a good long term investment.

I also have no qualms over individuals owning the rent stock. I don't see state systems being any more efficient, and could be a drag on the treasury coffers rather than an investment. (I know, we need to find out why governments cannot run affairs efficiently. I have tried to find the answer, even when as chairman of a health authority, I scratched my head.)

Yes, there are good landlords and there are bad ones. I do work for a healthcare regulator and there are good and bad doctors, good and bad NHS trusts, good and bad GP practices. It doesn't make a case for generalising about healthcare though.

Just out of interest, for me, investing in new windows, heating etc is a good investment anyway, and the quality of accommodation for my tenants helps make the case. Many bad landlords are looking for other ways of making money right now, and I am shocked at how many properties are on the market in the buy to rent game. Those who do not maintain their houses are after a quick buck and see maintenance as an expense that erodes your profit when selling on. Perhaps the answer is to find a way to make it attractive to keep properties a long time, hence making maintenance a more viable business as well as moral decision? I see mine as very long term and assume they will be part of my estate in the very long term future. I don't intend to sell them whilst people are renting them.

I don't know the answer to making renting a better experience, but will as ever get a bit precious when the bad are portrayed as the norm.