Message to private landlords: give universal credit a chance
Few systems have caused as much controversy before even being launched as the government's universal credit. It draws together all welfare claims into a single monthly payment, like a salary, so will undoubtedly change the financial landscape for landlords and tenants – yet it has the potential to improve the claims process for all involved.
One of the big benefits of the system – if implemented correctly – is that claims will be processed online and in real time. The amount of paperwork generated under the current system means important information required to process claims can get lost far too easily, leading to delays. The online system should eradicate this problem and allow claims to be made quickly and efficiently. Of course this depends on how user friendly the online platform is.
Today the issuing of housing benefit payments varies too widely across the country. If you operate in more than one local authority area, as many letting agents do, it can be difficult to manage. While property and tenancy regulations are made nationally, they are implemented locally. Some councils I've dealt with, such as Wolverhampton, actively seek out the opinions of landlords and consult with them on the best ways to handle the benefit process. Others leave landlords out in the cold.
A universal system will help eliminate the confusion and red tape that can complicate and delay housing benefit payments to private landlords. A critical part of renting property is the relationship between landlord and tenant. It's assumed there's a certain level of prejudice towards people on benefits, which in some cases can be correct. However the disparity across the current benefit claim system can make it difficult to maintain successful relationships.
Ask any landlord what they care most about and the answer is almost always going to be getting paid on time. Under the current system councils are failing to keep up with a backlog of claims – in some cases the wait can be up to six months. Is it any wonder that private landlords often refuse to touch the benefit sector at all?
Universal credit will offer these landlords a way to rent to tenants on benefits directly. I've even spoken with one agent whose business plan is to expand into the housing benefit market once universal credit launches. This is encouraging for the future of private rent, an increasingly important sector of our housing system.
There will, of course, need to be a grace period for universal credit to be implemented successfully. It cannot be expected to be a quick fix or an overnight success, but it certainly has the underlying potential to improve the way landlords and letting agents do business. I, for one, am keen to give it a chance.
Aki Ellahi is a landlord and lettings agent and founder of dssmove.co.uk