Regulations, government interference: Do rents in the UK have to be controlled?

[ardcarp]

The normal situation is for HB to be paid to the tenant who then pays rent to the landlord, but as you pointed out:

In some cases, your council can pay your money direct to your landlord.

For a while, the government discouraged councils from paying HB diecttly to landlords. This was a disaster, because those who were unable to manage their own household expenses got into dreadful arrears and in some cases lost their tenancies, thus landing the councils with a heap more trouble and cost. Luckily that decision was quickly reversed.

It may be that the right to buy policies, which were heralded as bringing in benefits to many and giving them aspirations, have in fact now come back to bite us, as there is now an acute shortage of housing in sectors where previously there was not such a great problem.

Forgive me a wry smile at 'coming back to bite us', because many (most?) of us could foresee the problem as soon as Mrs T conceived the crazy idealogical notion.

(Whoops, I'm getting political...better stop now.)

[Barbirollians]

The normal situation is for HB to be paid to the tenant who then pays rent to the landlord, but as you pointed out:



For a while, the government discouraged councils from paying HB diecttly to landlords. This was a disaster, because those who were unable to manage their own household expenses got into dreadful arrears and in some cases lost their tenancies, thus landing the councils with a heap more trouble and cost. Luckily that decision was quickly reversed.



Forgive me a wry smile at 'coming back to bite us', because many (most?) of us could foresee the problem as soon as Mrs T conceived the crazy idealogical notion.

(Whoops, I'm getting political...better stop now.)

I am afraid you are wrong Ian Duncan Smith made it far more difficult to pay landlords directly and this remains the case .

[ardcarp]

I am afraid you are wrong Ian Duncan Smith made it far more difficult to pay landlords directly and this remains the case .

Well, tenants receiving HB from the County Council where I live can once again apply to have it paid directly to landlords. I believe they have to state the reason, but (oh dear I sound like a filthy capitalist) we receive HB directly for two out of three tenants we have. Our CC is a Conservative controlled outfit, so by your reckoning they must be flouting their own rules.

[Barbirollians]

Well, tenants receiving HB from the County Council where I live can once again apply to have it paid directly to landlords. I believe they have to state the reason, but (oh dear I sound like a filthy capitalist) we receive HB directly for two out of three tenants we have. Our CC is a Conservative controlled outfit, so by your reckoning they must be flouting their own rules.

It is a power to pay directly in certain circumstances .- In the past if a tenant consented it would go through as a matter of course . With local housing allowance however a much stricter test applies and IDS has encouraged local authorities not to pay rent direct to encourage tenants to develop financial management skills ! For all too many living close to poverty it has just encouraged them to spend their HB .

[ardcarp]

IDS has encouraged local authorities not to pay rent direct to encourage tenants to develop financial management skills !

Poor man doesn't live in the real world.

For all too many living close to poverty it has just encouraged them to spend their HB .

IDS would probably say 'on beer and fags', but he should try living on a minimum wage. His butler would have to go for a start.

[Barbirollians]

An illuminating statistic today £1 in 33 from the welfare budget goes to the unemployed - £1 in 7 goes to private landlords .

[Flosshilde]

For all too many living close to poverty it has just encouraged them to spend their HB .

I think 'encouraged' is really the wrong word - 'made it possible' to spend it on food, or heating, or any other immediate need.

[Flosshilde]

It may be that the right to buy policies, which were heralded as bringing in benefits to many and giving them aspirations, have in fact now come back to bite us, as there is now an acute shortage of housing in sectors where previously there was not such a great problem.

Chickens coming home to roost, more like. One of the worst aspects of this apalling policy was (is?) that councils were not allowed to spend the proceeds on building more housing. It was quite obvious that 'social housing' stock would decline - but this, no doubt, was what the lady wanted. The Labour policy of only giving money to councils to improve housing stock if they handed the houses over to private housing associations excaerbated this.

[ahinton]

Chickens coming home to roost, more like. One of the worst aspects of this apalling policy was (is?) that councils were not allowed to spend the proceeds on building more housing. It was quite obvious that 'social housing' stock would decline - but this, no doubt, was what the lady wanted. The Labour policy of only giving money to councils to improve housing stock if they handed the houses over to private housing associations excaerbated this.

I don't doubt what you write here insofar as it goes but am unconvinced that these were the only material discouraging factors where local authority social housing invesment plans are concerned; as I mentioned earlier, the cost of such construction and subsequent maintenance is surely discouragement in itself (especially when national government is periodically cutting back its support for local authority operations) and, in any case, a not insubstantial proportion of tenants of such social housing will in any case be entitled to receive housing benefit from local authorities to help them pay rent to those very authorities, as well as reductions in their liability to the council tax due to those authorities...

[Barbirollians]

I think 'encouraged' is really the wrong word - 'made it possible' to spend it on food, or heating, or any other immediate need.

I agree entirely . Made it possible is much more what I meant .

[Barbirollians]

Right to buy has been a spectacular housing policy disaster . A very significant proportion of these homes are now in the hands of private landlords letting them to the same group in society at much higher rents to our cost as the housing benefit bill rockets .

It was in essence , a bribe with public money .

[ardcarp]

An illuminating statistic today £1 in 33 from the welfare budget goes to the unemployed - £1 in 7 goes to private landlords .

I've no idea where that comes from, but I can only repeat that without private landlords (landlord is a ridiculous term IMO) there would be nowhere for millions of people to live. Being well to the left of centre myself, I would be happy to live in a society where the state undetrtakes to provide housing for all those in need. It is a mistake to think that every penny of the rent goes into rich landlords' pockets. There are costs such as maintenance, decorating, carpets, insurance and much else besides, not to mention capital outlay, servicing loans, etc. I am sure there are a few unscrupulous landlords around, but the vast majority will want their tenants to be happy and fairly treated, and for their properties to be well-maintained.

[ahinton]

Right to buy has been a spectacular housing policy disaster . A very significant proportion of these homes are now in the hands of private landlords letting them to the same group in society at much higher rents to our cost as the housing benefit bill rockets .

It was in essence , a bribe with public money .

For all the problems that have undoubtedly emerged from that policy, I don't think that it hs been the unmitigated and universal disaster as which you appear to portray it and has in some cases helped to ease local authorities' cashflows in some of their more cash-strapped times.

[ahinton]

I've no idea where that comes from, but I can only repeat that without private landlords (landlord is a ridiculous term IMO) there would be nowhere for millions of people to live. Being well to the left of centre myself, I would be happy to live in a society where the state undetrtakes to provide housing for all those in need. It is a mistake to think that every penny of the rent goes into rich landlords' pockets. There are costs such as maintenance, decorating, carpets, insurance and much else besides, not to mention capital outlay, servicing loans, etc. I am sure there are a few unscrupulous landlords around, but the vast majority will want their tenants to be happy and fairly treated, and for their properties to be well-maintained.

Yes, landlord is indeed a ridiculous and divisive-sounding term. I agree with all else that you write here. All letting involves all manner of expenses for those who do it, just as in any other business; these business expenses may be offset against taxes, of couse but they still have to be paid, as do the taxes on the net profits from the rents received. This is especially the case for those who build housing for letting, as they have to fork out planning, architectural and land/construction costs in addition to the expenses that they will incur once the properties are built and let.

So much clamouring for the construction/provision of vastly more social housing all too often seem to overlook the various burdens that it places upon the local authorities, housing associations &c. which do not always have sufficient wherewithal to invest in that provision or maintenance; given that a notable proportion of social housing tenants will be entitled to receive housing and other related benefits to help meet their costs for renting their homes and that some of these will be provided by the landlord in the case of local authority properties, this is anything but a small issue. That's not to say that more social housing isn't required - merely to point out that its provision and maintenance cannot simply be funded out of nowhere. Yes, there are indeed some unscrupulous private landords just as there are unscrupulous people in most walks of life but, for example, there's one private landlord in these parts who lets so many properties that he probably doesn't know which in the area are his and which aren't but he only ever increases rents when tenants leave and new ones take over - and not even always then - so that some of his tenants haven't had a rent increase in ten years or more.

[ardcarp]

I dare say the 'small private landlord' manages things with a minimum of fuss and bureaucracy. Additional costs for a local authority trying to run the entire housing stock would be the armies of administrators (with sick pay, maternity leave, pensions, etc) and the banks of dodgy computer systems needing a whole other army to understand them.

Oh dear. I sound like an advocate for privatisation of everything which I certainly am not.