Posted by Jayne Codling
Landlords and property management agents with tenants affected by the government's cap on housing benefit have been urged to be open to negotiations over rent payments.
According to eviction specialists Turner & Howard, government plans to place a maximum limit on the amount of benefits any one household can receive will mean a shortfall of £600 between payments and the rent for an average property, rising far higher inside London.
Speaking to landlordportfolio.com, the company's director Miles Turner encouraged landlords and tenants to get in touch to discuss the possibility of adjusting rents so that the tenant can continue to live at the property.
"If tenants have not already done so, they need to contact their landlords immediately if they cannot afford the rent due to housing benefit caps. We are urging tenants and landlords to negotiate rents," he said.
Although this may mean landlords see a cut in income, it could work in their favour in the long run, said Mr Turner.
"While the average rent loss will approximately amount to £600 per property on an annual basis in most of the UK, landlords need to note that if they instigate repossession procedures, it could cost them considerably more due to eviction costs and rental voids," he explained.
The cuts in benefits, being introduced by the Department for Work and Pensions, are a reaction to the government's belief that housing benefit expenditure is spiralling out of control, largely because of rising rents in the private sector.
However, the reforms have met strong opposition due to fears that it could lead to thousands of people losing their homes.
"We cannot even begin to assess the effect the caps will have until after March when we can gauge repossession figures once UK eviction statistics are collated and released," said Mr Turner.