LHA landlords told to cut rents

Minister calls landlords to cut their rents prior to the implementation of the Local Housing Allowance (LHA) changes due from April 2011 for new tenancies and from Jan 2012 for the capping of existing tenancies.

Lord Freud the Welfare Reform Minister said:

“We are looking for private landlords to respond to the need for lower rents and in return we are prepared to permit direct payments from the state.

“This incentive will bring an overall downward pressure on rents in the private sector. As these rents come down, more properties will become available to claimants and landlords will have certainty that their income will be protected.”

The changes in housing benefit are being laid before Parliament in New Housing Benefit Regulations which will restrict the total amount paid to any landlord for new tenants to £400 per week per rental property.  The overall rate will also be cut from the 50 percentile rent in the BMRA to the 30 percentile figure.  In some cases this could lead to a significant fall in the benefits paid to the tenant.

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