We Need To Talk About Housing Benefit

Judging by headlines in the right wing press, you’d think Housing Benefit claimants are so carefree and loaded that they set flaming tenners loose in the wind – just to see them fly! Such misinformation means we need to have a conversation. We need to talk about Housing Benefit: what it is, who it’s for and where it really goes.

Yes, we do. Housing Benefit has been cut (no – not ‘capped’ it’s actually a cut in disguise) and undermined by the new accepted dictum that claimants are scroungers, when they are you, me, and everyone you know. HB claimants are more often than not in part time work. Official government stats support the view that it keeps people with precarious lives and few options in housing.

But let’s look at what this is again. We have created a system where rents are so ridiculously and unsustainably high, that they need state subsidy for tenants to afford them. Most claimants are employed. This again raises the spectre of low wages, which in turn means that the state is propping up the profits of companies who are cynically raking in profits while paying low wages (the minimum wage, and even the so-called living wage are both too low for long term survival, to rent, let alone buy a home.)

I have little sympathy for profiteering buy-to-let landlords who are cranking up the rent when interest rates are still so low. Yes, mortgages are hard to come by, but as I have said many times before: profit was once, and should be again, made by accruing equity long-term rather than screwing and squeezing renters, who must beg the state for help.

This is the problem with the housing Benefit issue: the money goes not to claimants, but to bail out and landlords. The money is paid to the person who owns the place and rents it out. They charge what they want, and where demand is high and supply low, they even accept sealed bids on rented properties; the highest bidder wins.

We really need are rent caps, powerful rent officers, and more social housing. All are achievable. It’s funny isn’t: bailing out banks was never seen as state aid to ‘spongers’ (well, not by the scroungers themselves) but an entire section of society is victim to unregulated rent rises. Instead of rent caps, ministers limit the amount paid to claimants. This makes no sense at all.

This is true cruelty: housing benefit cuts reverse the binoculars and place the problem of that escalating benefits bills not on landlord greed, pension concerns, or even (shhh…) capitalism’s nastier inevitabilities, but on the poor blighters living in hovels where rents are being ramped up every six months due to lack of supply in some places, and elsewhere pure blinding greed.

I’ve been saying this for ages, and I’m getting the feeling nobody is listening, and that nobody in power (Condems are Labour) care about the stinking, fetid, despicable stench of a mess that is the private rental sector.

Something Very Bad Is Going To Happen

Some time ago, I was standing on my tiny balcony which, being apparently made of chicken wire seemed to float above the world, and gazed across at a host of empty newbuilds, pondering the block I called Dovecot Towers. I thought to myself: I got it right.

Quite early on, I spotted the effect that ill-considered, mass buy-to-let property investment would have on the UK’s economy. Despite suspecting that economics is up there with voodoo and homeopathy, I predicted (well, not just me) that the property downturn was a coming in, and was vindicated.

I mention this because the list of keywords (ie the phrases people google to find rentergirl) indicates that many desperate people are seeking help by using variations on phrases like ‘I am afraid of my landlord,’ and ‘I am afraid I will have to move because of benefit cuts.’

I have never seen so many people indicating they are really scared, if not overtly terrified for their security. Those affected by housing benefit cuts have much to fear, and I can’t say anything that will make things better: this policy is stupid, spiteful and misguided. It infantilises adult claimants, placing a huge proportion of the claiming population in an impossible position.

Firstly, flatshares for older people (and that can mean anyone over 30) are often hard to find. Secondly there are not enough house-share suitable homes – and families need them. Thirdly, having claimants for tenants is forbidden under many buy-to-let mortgages – did you know that?

And then there’s the second part of this rising fear: ‘I’m afraid of my landlord.’

Add that to the above situation, where tenants are being expected to ask for cuts in rent, or to tell their hostile overloads that they lied, and are claiming, or have lost their jobs, and you can perhaps see why this might end badly. How, in times of rising unemployment, do tenants approach a landlord they already fear, who is acting like the grand-high-ruler of their destiny, and say please sir, can you lower my rent?

Many landlords have held on to the property they bought when prices were soaring, and are now bracing themselves for an interest rate rise which will mean they must either raise rents, go bankrupt or swallow the loss (and this isn’t sympathy – they shouldn’t have been so stupid, but it’s tenants who will, as ever suffer.)

I must be a genius, but here’s what to do: bring back rent officers to lower/cap rents. Don’t cut the benefit which is paid to landlords in any case. Don’t place the vulnerable ie potentially homeless on the front line of this. Don’t leave it to terrified people to sort this mess out. Housing is not like food: you can’t go freeganing/dumpster diving, the only other option to claiming Housing Benefit is rough sleeping, which will increase.

Tenants are being forced to move when nobody: not landlords, councils, shared houses, people looking for lodgers in two bed newbuilds – accepts benefit claimants for tenants. This policy will end badly: really, really badly, and I really, really hope I’m wrong this time.

http://rentergirl.blogspot.com/2007/11/tulips-volcanoes-and-fireworks.html

http://rentergirl.blogspot.com/2007/08/property-crash-is-coming.html

http://rentergirl.blogspot.com/2008/10/battered-by-butterflies.html

http://rentergirl.blogspot.com/2009/06/tipping-point.html