As housing prepares for the introduction of Universal Credit, join our panel of experts from 12pm on Monday 6 August to discuss how to manage arrears
The total sum of rental arrears owned to UK housing associations is estimated at more than £350m, according to the Financial Inclusion Centre (FIC). Although an inevitable part of the job, allowing tenant arrears to grow can affect the quality of services housing providers can offer, the rent levels they charge and their relationship with lenders. The social impact of arrears can be devastating for tenants and communities, leading in the worst cases to eviction and homelessness.
Housing associations secured more than 7,000 evictions from their properties in 2010-11, setting the sector back an estimated £40.9m in the cost of court proceedings, missed payments and void periods. The FIC estimates that better debt advice for tenants could deliver an extra £49m to the social housing sector each year.
The arrival of direct payment of housing benefit to tenants as part of the Universal Credit single benefits payment is a major concern. Housing chiefs warn that a predictable rise in rent arrears will serve to scare away investors in social housing. Arrears could also drive struggling tenants to doorstep and payday lenders as families on the breadline struggle to match a falling income with the rising cost of living.
More than 100,000 private tenants in England and Wales are also in severe arrears according to figures released receivers working in the property sector. The figures represent a 24% year-on-year increase and the highest rate of arrears since 2008. The National Landlord Association (NLA) found 49% of landlords surveyed experienced problems with rental arrears in the last year. David Salusbury, chair of the NLA, said: “It is in landlords’ best interests to help tenants through tough financial times where possible.”
So how can housing providers cut rent arrears and support tenants struggling to keep up with payments? Join our expert panel from 12pm on Monday 6 August to take part in the discussion, or post a comment in advance now.
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