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Property investment: Arrears to rise with housing benefit cuts?

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Landlords could find that levels of arrears will rise again when planned government cuts to housing benefit go ahead.

Citizens Advice has warned that there must be a delay on when the cuts occur to help families and tenants make the transition.

The organisation is calling for the cuts to come into force in October 2011, to allow families and households to avoid being trapped in "unaffordable rents".

According to their figures, more than nine in ten (93 per cent) of people renting in central London will be impacted by the reductions.

The average shortfall for over 18,000 households, mainly located in the capital, will be around £81 a week.

Gillian Guy, chief executive at the charity, commented: "Tens of thousands of private tenants will find their rent is unaffordable and will therefore need to move at short notice to areas with lower rents as a result of the proposed cuts. 

"For many, such a forced move will be highly disruptive and stressful as well as putting additional strain on very limited budgets."

A separate report from Shelter last week calculated that managing the impact of the cuts, such as homelessness, would cost the taxpayer around £120 million annually.

 


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Date Published: 13 September 2010

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