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Large numbers of ‘baby boomer’ landlords are retiring from the private rented sector and are not being fully replaced, a study, led by the University of York’s Centre for Housing Policy has found.
It blames ‘diminished returns and more stringent regulation’ for the reluctance of younger landlords to step in.
Landlords found to be generally dissatisfied with the weight of ‘regulatory burden’ which includes possible criminal convictions and fines of up to £30,000 for Housing Act contraventions.
And the prospect of withdrawal or restriction in the ability to serve s21 ‘no fault’ evictions meant that some landlords were worried that they would be unable to evict problematic tenants.
The research, funded by the Nationwide Foundation, also found that Universal Credit rules and rates are having a big impact on landlords’ letting decisions.
Landlords are reducing their housing benefit lettings and new landlords are less likely to let in this market, said the researchers. Only 9 per cent of landlords in the market for three years or less said they currently let to people receiving housing benefit; for landlords letting for 11 or more years, this figure was 28 per cent, they reported.
‘It’s a real concern that many good, professional landlords are no longer letting to housing benefit claimants because of the way that Universal Credit is administered’, said lead author of the project, Dr Julie Rugg
‘Letting property looks altogether different to landlords now: it looks like a much risker proposition, delivering a lower level of return and with a lot more hassle.
‘As one landlord said to me, “stocks and shares may not deliver the same level of return, but they don’t phone me on a Sunday morning because the boiler’s bust”’.
Responding to the findings, the National Residential Landlords Association said no landlord should discriminate against tenants because they are in receipt of benefits.
‘Every tenant’s circumstance is different and so they should be treated on a case-by-case basis based on their ability to sustain a tenancy.
‘More broadly, the Government needs to take action to give both tenants and landlords greater confidence that benefits will cover rents. This should include reversing the decision to freeze housing benefit rates in cash terms and ending the five week wait for the first payment of Universal Credit. Ministers should also enable tenants to choose, at the outset of a claim, if they want the housing element of Universal Credit paid directly to their landlord. We need also a renewed focused on developing new social housing, alongside the private rented sector’.