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  • Buy-to-Let

    Proposals by a Tory Govt to make tenants pay 10% of their LHA!

    More aggro for HB LL and any LL that ends up with a HB tenant!!
    Apparently an incoming Tory Govt proposes to make HB tenants pay 10 % of their HB to the LL.
    Two hopes that this will occur
    One of them is Bob.guess what the other one is!??
    Will this make HB tenants just not worthwhile!!??
    Very few HB tenants are prepared to pay top up amounts
    How much are HB LL expected to subsidise such tenants before the LL gives up and rents to non-HB tenants!?
    This is even before UC is introduced!!??
    Such measures will surely force HB tenants to get a job or even move to a cheaper area!!
    It seems there is general resistance from HB tenants to pay anymore rent than the council provides!!
    The HB business model must surely come under increasing unsustainable pressure especially in the costlier South-East.
    Something must surely give and it won't be the LL!!
    What effects do the HB LL think this might have on their business model!?
    It puts me off even more! especially when combined with the OBC reduction to £23000
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    Interesting sure someone will know on PT? We are very successful with collecting top ups from lha tenants but you need to be thick skinned you will always NOT receive the full amount due from some tenants but as long as you still make good money it's well worth it ..if the lha tenant has to contribute more it will put some landlords under pressure although we are also seeing more lha tenants being pushed into work not such a bad thing....and they still need a room ..we shall see .
    Kim
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    You must be very thick skinned Kim because I find chasing people for top ups exremely unpleasant and mentally draining.That is why I now take Eastern Europeans and not LHA.

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    I havent heard this one and it sounds a bit of a non starter just from an administrative viewpoint.

    I get many of my LHA tenants through referrals. They are welcome aboard as long as they understand the code of behavior. I get the trusted ones to collect my top ups from other newbie LHA tenants. They have an internal unspoken hierarchy amongst themselves on the estate ( bit like prison) that means non payment is just not an option as its disrespectful to me and also to the top dog family on the estate. Saves me time and energy
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    Jonathan Clarke. http://www.buytoletmk.com

    You got any more on this Paul? - I can not find any reference.

    I dont understand its purpose as you describe, perhaps I am misunderstanding the proposals but in essence on a £350 every 4 weeks LHA, they will deduct £35. It makes no sense to me other than to reduce LHA bill.

    As for tenants paying top-ups sure for first month you are fine, then you are well in with a fight with every other supplier the tenant has. An LHA landlord we assist works her spreadsheets based on estimated LHA rather than the full rent that she and the tenant is contractually obliged to pay..
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    (10-02-2015 10:41 AM)Adam Hosker Wrote:  You got any more on this Paul? - I can not find any reference.

    I dont understand its purpose as you describe, perhaps I am misunderstanding the proposals but in essence on a £350 every 4 weeks LHA, they will deduct £35. It makes no sense to me other than to reduce LHA bill.

    As for tenants paying top-ups sure for first month you are fine, then you are well in with a fight with every other supplier the tenant has. An LHA landlord we assist works her spreadsheets based on estimated LHA rather than the full rent that she and the tenant is contractually obliged to pay..

    Sorry Adam I read it on the net probably from an email I received; I think!!?.
    I suppose it would have been helpful to add a link to the post etc.
    Trouble is I am a bit of a computer DUMMY
    So apologies for being a bit thick when it comes to using a computer which I appreciate is less than helpful in this situation!!!!
    I don't even really know what cut and paste is and certainly NOT how to do it!!!!!!!!!
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    Adam correct in the rooms lha world especially I figure if I should get say £10,000 per month and I actually receive £8000 and all my fixed costs are say £4000 and my net is £4000 per month then we doing ok..it is a thick skinned business but very lucrative if landlords are used to it they will cope it's the less experienced sensitive landlord who will struggle I think with the amount of cuts coming after the election benefits going to be hit in some ways or another we shall see .
    Our houses single lets are much more normal especially in the lha world .
    Kim[/i]
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    Was a LL in the good old days when we were paid housing benefit direct in ALL cases. Then, this working policy was changed to give HB tenants responsibility. For 6 of our tenants and us, this did not work out, responsibility was not their thing . After a long costly battle I did perservere to mentor 2 tenants who are still with us.

    We have 2 long termers left and due to their personal issues and me negotiating on their behalf with their local councils, when their six week arrears period was up, I was paid direct. In both cases they couldnt be arsed to sort it out. ( * have the skills to rectify *) One of these local authorities has an anti- landlord approach which further disinsentivises the 'help those less fortunate', ethic.

    I''m sure that there are LL out there with many positive experiences with HB tenants , but for us it's been the opposite. To expect a LL to teach  their tenants to be responsible individuals and conform to societal norms is ultimately scapegoating a LL to deal with societies messes.

    Around 2008, coumcils set the LHA at the same level as the PRS in a drive to create equality in where a person on HB, in relation to a private renting tenant could live. This is a move that is now backfiring in line with s.24, yr 1 of tangible entry.  The nicer areas to live command the biggest rent rises. The LHA can't keep up.

    The final straw in taking the decision to take no more HB tenants has been the Local authority not raising the Local Housing Allowance rates. They  sit 25% below their market value.

    Personally, we raised them to 5% below this and the tenants were topping up ( irregularly) One has just given notice as they not happy with the increase and left the property a state. However, their absence is a weight off the shoulders.

    To then be further insulted with threats from government reps, intimidating LL to turn in to a charity that provides free homes and a personal social work service,  is a joke.

    Having two seperate payments coming in, one usually 4 weekly but not always and another part in irregular installmemts , if at all, is not  another blow that many wisened HB /LL acceptees are likely to tolerate.

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    I have been a die hard LHA LL since 1999 but like you seen a gradual erosion of our working conditions due to a relentless attack on LL and tenants via  the welfare budget so called reforms  The attack has hit both  Even though the HB Regs Amendment  came in force  2011 which allowed all my payments to become  direct once more,  that incentive was overshadowed and made meaningless with the LHA freeze but more so the HB caps making the model very uncompetitive.

    But the final straw for me is none of that  - it is UC which has already dealt a fatal wound to one of my tenants  and left me incandescent with rage at a system not fit for purpose. For the last two years I got direct LHA payment with a vulnerable alcoholic tenant with an addictive dysfunctional personality.   I worked with the welfare state and social services and her extended family and took her in to try and establish a workable solution for her and her 2 kids. And for 2 years it worked well . I got my rent on time every time and social workers and extended family worked with her to deal with her issues. They were  able to do that in the knowledge she had a safe space to stay which was only 30 yards down the street from her extended and very supportive family .

    Then without any notification to me or her extended family she was put on UC. She spent it on drink, got drunk. got arrested, lost her kids and has now lost her. home. The rent arrears reached about 2K and it could all have been avoided  if i and the extended family had been included in her personal care plan but I and they were excluded. The government can talk about social responsibility of the tenants managing their finances to prepare them for the workplace and its all very laudable. But there is a whole section of society that would need one on one support in order to achieve this. And that support is simply  not there. And in many cases its just not sensible to give them the money at the outset. Saying it can be paid direct later if they fail to pass it on is way too late as it was with this tenant. 

    Even though its not my role they could have used my support as an add on to social services working together with the welfare dept to achieve the best outcome for the tenant. Its in my business interests to do this and I also have a social conscience which the LHA model appeals to   But they didnt want to work with me . They did and wanted  exactly the opposite in fact. They ignored me sidelined me and actively excluded me from the process of transition of LHA to UC ..  So one of the main persons in their life responsible for keeping a roof over her head for her and her kids was excluded in any discussion or decisions about that roof over the head and how it should be financed

    Its an example of the governments  abdication of responsibility and a neglect of their duty of care towards  an individual  -

    especially a recovering alcoholic

    To suddenly give a recovering alcoholic with an addictive personality £600 rent   is asking for trouble .

    And trouble is exactly what happened . And you could see it happening from a mile off.

    It was an accident waiting to happen. It was like a slow motion car crash

    And it is and will be happening on an industrial scale as UC is rolled out with its crude flawed implementation

    The government is setting thousands of ex LHA now UC tenants up to fail

    I saw it unfold before my eyes and was powerless to stop it

    And it is an act of criminal neglect in my eyes

    I`m toying with building a case against the state for criminal neglect. There are 1000`s who do not have a social worker and it would be harder to prove but someone who has been assigned a social worker and has multifaceted needs and should be supported one can build a case. Their housing needs should be looked at as part of their care plan. Not to do so and not to see the warning signs with UC is a criminal  neglect.

    You do not give a recovering alcoholic £600 behind the back of a social worker . It undermines their work

    The same for heroin addicts, gambling addicts, shopping addicts and countless vulnerable others

    It makes the government complicit in the crime  of criminal neglect time after time

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    Jonathan Clarke. http://www.buytoletmk.com


    Hi Jon

    I see where you are coming from regarding a criminal Case. In some local authorities, tenant liason officers are employed to prevent such incidences. They act as a go between for landlords and tenants to help the tenant maintain their tenancies.

    It's the postcode lottery effect though as In some areas they don't exist, most likely  the area where you and your tenant were ultimately let down. Vulnerable people are labelled that for a reason and for the state to be ignorant to that in all Areas of that person's well being is morally criminal, at least.

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