Quarterly Report Aidan Crehan 09/07/2021

In Focus (2021 Qtr 1): Universal Credit, welfare & debt

Qtr 1, 2021 Landlord Survey - Universal Credit

Last updated: 09/07/2021 at 10:12 - 981.83 KB

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Universal Credit

Over one third of landlords currently let to tenants claiming Universal Credit (35%), this figure has risen every year since 2018.

One fifth of landlords letting to UC claimants noted that these tenants were claiming due to the financial impact of the pandemic. Almost a third of this landlord grouping have personally provided support through reduced rent/rent arrears (32%). 

Almost half of landlords who let to UC claimants have experienced rent arrears in the last year. Many landlords state that the arrears are down to the Universal Credit system itself. This is consistent with previouse surveys the NRLA has undertaken. 

Welfare issues

Many landlords are unaware whether or not their tenants claim welfare.

Those landlords with concerns over letting to claimants cited worries over rent being paid on time and a higher risk of rent arrears as the two primary reasons. The most influential policy proposal that would alleviate this landlord grouping's fears would be for the payment of the housing element of Universal Credit being paid directly to the landlord. This suggests many landlords are unaware that this option exists.

Payment arrangements

Landlords experiencing arrears may attempt to recover funds through payment plans, the success of these plans in recovering funds has been mixed.

Landlords or tenants claiming Universal Credit can apply for Alternative Payment Arrangements (APAs). The majority of this group of landlords have not applied for such a scheme (77%).  Amongst those landlords who have requested an APA,  36% found the process difficult or very difficult.

Debt response

The majority of landlords have not attempted to recover arrears debt through a more formal mechanism in the last 2 years (81%).

The pandemic has made landlords more likely to forgive debt, with over a quarter stating they would now be more likely to write off debt due to the impact of COVID-19. 

This data provides evidence to suggest landlords have placed an increased emphasis on tenant relationships and maintaining tenancies, rather than debt reclamation

Landlord confidence

Landlord confidence remains low across the country, every region achieved a net negative score when asked how confident they were in achieving their goals. Compared with quarter 4 however, there has been substantial growth in confidence across every region.

Any growth in confidence was minimal in London. London remains the region with the lowest confidence score, lagging the national indicator and other regions.

There is more on landlord confidence - follow this link.