Housing Benefit Cap

Am I missing something here?

The Labour Luvvies claim that the cap (£21,000 for a four bedroom house??) will force people on housing benefit who presently pay more than the proposed caps, in Central London for example, to have to move out.

Ignoring my initial knee-jerk response, of, So what?, surely market forces will cause the landlords to lower rental levels to whatever is payable under the housing benefit system, rather than sit with empty properties.

Or is it the landlords who are stirring up all these protests?

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Author: coldwaterjohn

CWJ travelled extensively with his family, having worked in eleven countries over thirty years. A keen photographer, holding a Private Pilot's Licence, he focuses mainly on landscape and aerial imagery. Having worked in the Middle East extensively he follows developments in that region with particular interest, and views with growing concern, the radicalisation flowing from Islamic fundamentalism, and the intolerance for opposing views, stemming from it.

9 thoughts on “Housing Benefit Cap”

  1. I believe it is the landlords who are seem to be able to charge what they please. They are driving rents up.

    Hopefully this will stop now there is a limit.

  2. I suppose that is what I meant Araminta. If there are so many as is claimed who would have to move, that implies a large volume of empty rental properties. No landlord, particuraly those who have buy-to-let mortgage financing to servie, can afford to leave properties empty for any length of time.

  3. Since it was the Conservatives who removed “Controlled Rents” (rightly so) and let the “market” determine what landlords can charge, I find it quite ironic that they are having to deal with what anyone with a grain of sense could see would be the logical outcome of that policy.

    It is all very well people talking about high-charging landlords. But face the facts. The Sainted Margaret effectively removed a large amount of housing out of the public sector and did not allow further building to replace the dwindling stock of Public Housing, and, thereby, caused a shortage of ‘cheap’ housing. Market forces will always push up the price of a necessary commodity (and one cannot get a more necessary commodity than a home) if that commodity is in short supply.

    When the rents were decontrolled, it was expected that the Private Sector would invest in rental properties. This took far longer than anticipated – but eventually people have invested their cash in property to rent. Do not forget that housing shortages have also pushed up the price of purchasing a house. Investors in the rental market need to see a better return on their money than they can get elsewhere – or they will sell and put their money elsewhere. Then, there will be no rental property and the value of everyone’s house will fall …

  4. Quite, CWJ.

    The other consideration is that despite the Daily Mail highlighting each and every one of these cases, there are few who exceed this new limit anyway.

    I think this is good anyway, and I am not sure why people who do not work need to live in Central London anyway.

  5. Could you ignore most of the “anyways” please. I’m not proofreading very well before hitting the submit button.

    I blame it on the excellent lunch!

  6. Take your point Boadicea, but the rental market is doing very well at the moment because property is not selling.

    Local authorities, or the London boroughs will pay whatever is asked because it is cost effective. Renting is still much cheaper than hotels. Landlords know this and take advantage.

  7. The problem is not so much with landlords charging high rents, as in councils and governments having tolerated a situation where they are prepared to allow someone unemployed to remain in prime real estate, jobless, at the state’s expense. There are whole blocks of streets of housing standing empty in depressed areas of the country.
    “The Sainted Margaret” provided the opportunity to those who never believe they could own their own houses, to do so, and in the same stroke removed the continuing maintenance costs of the former council housing from the Government’s budget. House prices in the UK are depressed presently by between 10% and 25% in some areas or more, from their prices jsut a few years ago. What is making the rental market buoyant and the sales market stagnant is the inability of first-time buyers particularly to meet the more conservative lending criteria forced on the banks by their previously totally irresponsible multiples of income-based lending, with no corroboration of income declarations – if total incompetence was an imprisonable offence, that is where many of them would be.

  8. It is notable that there are no whites in these expensive houses, they live in the cheaper suburbs.
    So perhaps a first class one way ticket home might be a cheaper option!
    Or turfed out into the gutter.

  9. I daresay that house prices in some areas are depressed by the the presence of benefit claiments.

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