Confusion over how rent arrears will be tackled under the Universal Credit has prompted landlords to reduce the number of properties they let to welfare recipients according to research from the British Property Federation.
The BPF says agents, landlord groups and Government should all act to reduce the uncertainty of the impact of Universal Credit after it found that 39 per cent of large scale landlords with more than 10 properties were intending to reduce the number of units they let to those on housing benefit, when the change comes in.
The Universal Credit is designed to offer greater protection to landlords from rent arrears, but the BPF says this message is not accepted by many landlords.
Instead the BPF wants the Department for Work and Pensions to set out how it will inform private landlords when a tenant has a change of circumstances that affects their housing benefit; and wants the Government to allow tenants to choose direct payment to landlords from the outset if they are worried about managing their finances.
Ian Fletcher, policy director at the BPFm says: The challenges of housing supply will inevitably see the private rented sector continue to be relied upon to house welfare recipients. Universal credit is the most radical change to affect the payment of benefit in several generations and if private landlords do not feel confident they are going to receive rental income they will vote with their feet and not engage with it.
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