State of the PRS - 2019, Quarter 1
Summary
This quarterly report was based on a survey of over 2,000 landlords. Conducted in April, the survey focused on Welfare Reforms, most notably the views of landlords on the roll-out of Universal Credit.
This report was written by Edge Hill University’s Unit for Evaluation and Policy Analysis.
Portfolio analysis
Almost half of landlords (45%) reported that they receive less than £2000 per month in gross rental income, with 21% of landlords reporting they receive less than £1000 per month.
The majority of landlords reported that in the past 12 months they did not make any changes to their portfolio. There were slightly more landlords reporting they had sold properties in the past 12 months in comparison to those who reported buying properties.
However there were twice as many landlords reporting they would sell property (31%) in the next twelve months compared to those planning to buy property (14%).
Universal Credit
The report finds that the roll-out of Universal Credit is still causing problems for landlords and tenants in the private rented sector.
Over half of landlords (54%) with Universal Credit claiming tenants had experienced those tenants going into rent arrears in the past 12 months.
In the most recent case of rent arrears these landlords reported they were owed on average over £2,100.
The majority of these landlords (82%) reported that the rent arrears began after either a new claim for or migration onto Universal Credit.
Reform to Local Housing Allowance (LHA) rates
The study found that affordability for low-income private renters was a significant barrier to accessing housing in the private rented sector.
There are gaps between the rent and what is covered by LHA rates – 65% of landlords reported this gap was over £50 a month.
Welfare reforms
Over half of all landlord respondents reported that they were unwilling to let to people who claim Universal Credit (57%).
Over half of landlords reported that the cap and 4-year freeze to LHA rates as well as increasing regulation of the PRS had made them less likely to let to benefit claimants.
Landlords are becoming more risk adverse due to welfare reforms over concerns of financial risk and rent arrears. The development of a Payment Voucher Guarantee Scheme is one idea for a mechanism which would encourage landlords to let to benefit claiming tenants.
2019 Q1 State of the PRS Report - FINAL
Landlord quarterly survey with a focus on Universal Credit, written by Edge Hill University.