Landlord groups and housing charities have united to denounce the recent local housing allowance (LHA) freeze.
The benefit was frozen despite widespread rising rents, which will leave tenants in some parts of the country facing a shortfall of more than £100 a month, says Shelter.
Chief executive Polly Neate believes housing benefit should be there as a safety net to protect people who’ve hit rock bottom, and if it’s not fit for purpose, homelessness will rise.
She adds: “The government can step in and keep more people safe in their homes, by reversing the freeze on housing benefit. Without this, a rising tide of homelessness could be the legacy of the pandemic.”
The National Residential Landlords Association says the pandemic has highlighted the need for a welfare system that provides tenants and landlords with confidence that benefit payments will cover rents.
A spokesman tells LandlordZONE: “For this reason, we strongly oppose the Chancellor’s decision to freeze the Local Housing Allowance in cash terms.
“It will serve only to make it more difficult to sustain tenancies. The Chancellor should think again and, at the very least, restore the allowance to the 30th percentile and preferable ensure it covers average rents in any given area.”
However, rental agency Pick My Pad reckons that despite the freeze, many tenants on benefits are in a position to cover their rental costs.
CEO Mish Liyanage says that in Manchester, the LHA rate is £138.08 per week for a one-bed property while the average private rent is £120 a week. He adds: “An agent can secure a higher rate per week eligible for the DSS tenant, vet the tenants, and get a non-cash damage bond on your behalf.”
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