Monitoring the impact of recent measures affecting Housing Benefit and Local Housing Allowances ...

161 Pages·2017·1.48 MB·English

Monitoring the impact of recent
measures affecting Housing Benefit
and Local Housing Allowances in the
private rented sector in Northern
Ireland
Final Report

Christina Beatty, Ian Cole, Stephen Green, Peter Kemp, Ryan Powell and Elizabeth
Sanderson

March 2014

Centre for Regional Economic and Social Research, Sheffield Hallam University, Ipsos
MORI and Blavatnik School of Government, University of Oxford
Disclaimer
Views expressed in this report are not necessarily those of the Northern Ireland Executive through
the Department for Social Development, the Northern Ireland Housing Executive, the Department
for Work and Pensions or any other government department.

Acknowledgements
The research for this report has been funded by the Northern Ireland Executive through the
Department for Social Development and we are most grateful for their support. We would like to
thank all the people for giving up their time to take part in the two surveys and the follow-up depth
interviews covered in this report. We would also like to thank the housing advisers in Armagh and
Belfast for taking part in interviews and focus groups and for being so informative about the impact
of the LHA measures.
We are grateful to colleagues at CRESR and Ipsos MORI for all their support in undertaking the
surveys and the qualitative fieldwork. This report has benefited considerably from very helpful
comments and suggestions made by officials at the Department for Social Development, the
Northern Ireland Housing Executive and the Department for Work and Pensions. In particular we
have received extremely constructive advice during this project from Martin Walker at the
Department for Social Development, Joe Frey and Claire Kennedy at the Northern Ireland Housing
Executive and Andy Brittan, Claire Frew, Vicky Petrie and Rachel Tsang at the Department for
Work and Pensions. We would like to record our gratitude for their valuable support to the
research team. Any inaccuracies or omissions that remain in the report are of course solely our
own responsibility.
Christina Beatty, Ian Cole, Stephen Green, Peter Kemp, Ryan Powell, Ian Wilson
March 2014
Authors
Ian Cole is Professor of Housing Studies in the Centre for Regional Economic and Social
Research at Sheffield Hallam University. He is the Project Director for this review of the impact of
recent measures for Housing Benefit/Local Housing Allowances in the private rented sector.
Christina Beatty is Professor of Applied Economic Geography in the Centre for Regional Economic
and Social Research at Sheffield Hallam University. She is Project Manager for this research
project.
Stephen Green is Research Fellow in the Centre for Regional Economic and Social Research at
Sheffield Hallam University.
Peter Kemp is Professor of Public Policy in the Blavatnik School of Government and a member of
the Institute of Social Policy at the University of Oxford. He is responsible for the analysis and
reporting of the claimant surveys.
Ryan Powell is Principal Research Fellow in the Centre for Regional Economic and Social
Research at Sheffield Hallam University.
Elizabeth Sanderson is Research Associate in the Centre for Regional Economic and Social
Research at Sheffield Hallam University.
Abbreviations
BRMA Broad Rental Market Area
CB Child Benefit
CLG Communities and Local Government
CPI Consumer Price Index
CRESR Centre for Regional Economic and Social Research
DHP Discretionary Housing Payment
DSD Department for Social Development
DWP Department for Work and Pensions
GB Great Britain
HB Housing Benefit
HMO Housing in Multiple Occupation
IFS Institute for Fiscal Studies
IM Ipsos MORI
LHA Local Housing Allowances
NI Northern Ireland
NIHE Northern Ireland Housing Executive
PRS Private Rental Sector
SAR Shared Accommodation Rate
SRR Single Room Rate
UK United Kingdom
Contents
Executive Summary ....................................................................................................................... i
1. Introduction ......................................................................................................................... 1
2. The Research Context ......................................................................................................... 3
3. The Housing Market Context .............................................................................................. 7
4. The Survey of Tenants .......................................................................................................23
5. Landlord Characteristics and Lettings Preferences ........................................................45
6. Impacts on Rents and Arrears ...........................................................................................64
7. Potential Future Impacts of the Measures ........................................................................80
8. Conclusion ..........................................................................................................................87
9. References ..........................................................................................................................91
Appendix 1: Additional Survey Results .....................................................................................92
Appendix 2: The Claimant Survey Questionnaire .....................................................................97
Appendix 3: The Landlord Survey Questionnaire ................................................................... 117
Appendix 4: Note on Research Methods ................................................................................. 139
List of Tables and Figures
Figure 3.1: Northern Ireland Broad Rental Market Areas ...............................................................10
Table 3.1: LHA weekly rates across Northern Ireland, April 2013-March 2014...............................10
Table 3.2: Reduction in LHA weekly rates across Northern Ireland, January 2011 to April 2013 ...11
Table 3.3: LHA weekly rates in case study area BRMAs, January 2011 to April 2013 ...................12
Table 3.4: Reduction in LHA weekly rates, selected BRMAs in Northern Ireland and Great Britain,
January 2011 to April 2013 ............................................................................................................13
Figure 3.2: Housing Benefit Claimants in the Private Rented Sector in Northern Ireland, 2010-
2012 ..............................................................................................................................................14
Table 4.1: Demographic characteristics .........................................................................................25
Table 4.2: Moved home since we last spoke to you? .....................................................................27
Table 4.3: How far had tenants moved? ........................................................................................28
Table 4.4: Main reasons why tenants left their previous accommodation .......................................29
Table 4.5: Did LHA claimants who had moved face difficulties finding new accommodation? ........30
Table 4.6: Difficulties finding accommodation among all LHA tenants at wave 1 and tenants who
had moved at wave 2 .....................................................................................................................31
Table 4.7: The number of other properties that movers viewed .....................................................32
Table 4.8: Comparisons between the new and the previous accommodation for tenants who
moved home ..................................................................................................................................32
Table 4.9: Satisfaction with accommodation ..................................................................................33
Table 4.10: Did tenants try to negotiate the rent with the landlord? ................................................34
Table 4.11: Does the LHA cover all or part of the rent? .................................................................35
Table 4.12: Does the LHA cover all or part of the rent? .................................................................36
Table 4.13: Ease or difficulty of affording the rent (after HB) ..........................................................37
Table 4.14: Ease or difficulty of affording the rent (after HB) by shortfall status .............................38
Table 4.15: Prevalence of rent arrears ...........................................................................................38
Table 4.16: The single most important reason for the rent arrears .................................................39
Table 4.17: Ways in which the landlord has responded to the arrears ...........................................39
Table 4.18: How well or poorly are tenants managing financially? .................................................40
Table 4.19: How well or poorly tenants are managing financially by age and household work status41
Table 4.20: How often tenants have run out of money in the past 12 months? ..............................42
Table 4.21: How often tenants have run out of money in the past 12 months ................................43
Table 4.22: Managing financially and how often running out of money ..........................................43
Table 5.1: Landlord or letting/managing agent ...............................................................................46
Table 5.2: Status of landlord ..........................................................................................................47
Table 5.3: Length of time as a landlord ..........................................................................................48
Table 5.4: Portfolio within the case study area ...............................................................................48
Table 5.5: Total dwellings let by landlords .....................................................................................49
Table 5.6: Tenant profile: household characteristics ......................................................................50
Table 5.7: Tenant profile: Economic Status of Tenants ..................................................................50
Table 5.8: Lettings to LHA as a percentage of all lettings ..............................................................51
Table 5.9: Thinking of your rental properties located within ..., have you changed your letting
strategy since April 2011? .............................................................................................................51
Table 5.10: Have you changed your letting strategy in ... since April 2011 specifically because of
the reforms to the HB/LHA system? ...............................................................................................52
Table 5.11: In general, when letting accommodation, do you prefer to let to tenants who are on
HB/LHA or to those who are not? ..................................................................................................52
Table 5.12: Thinking of your lettings located within... have any of the HB/LHA reforms introduced in
April 2011 affected you so far ........................................................................................................55
Table 5.13: Which specific elements of the HB/LHA reforms have affected you so far? .................56
Table 5.14: Have you made any of the following changes to your rental business in...specifically
because of the changes to HB/LHA rules introduced since April 2011 ...........................................60
Table 6.1: Do you currently receive direct payments for any of your HB/LHA tenants in this area? 70
Table 6.2: Do you currently receive direct payments for any of your HB/LHA tenants in this area
due to any of the following reasons? ..............................................................................................71
Table 6.3: If a tenant could no longer afford the rent following changes to HB/LHA would you agree
to lower the rent to a level the tenant could afford, if the LHA was paid directly to you rather than
the tenant? ....................................................................................................................................73
Table 6.4: Do you think that the current HB/LHA reforms introduced in April 2011 have already
affected your role as a landlord/letting/managing agent in ... in any of the following ways? ...........75
Table 6.5: Have you made any of the following changes to your rental business in ... specifically
because of the changes to HB/LHA rules introduced since April 2011? .........................................76
Table 6.6: Have you taken action to evict, not renew or end tenancies of any of your HB/LHA
tenants since April 2011? ..............................................................................................................78
Table 6.7: Have you taken action to evict, not renew or end tenancies of any of your non-HB/LHA
tenants since April 2011 ................................................................................................................79
Table 6.8: Have you taken action to evict, not renew or end tenancies of any of your HB/LHA
tenants specifically because they can no longer afford their rent because of the HB/LHA reforms
introduced in April 2011? ...............................................................................................................79
Table 7.1: Do you intend to continue to let to tenants who claim LB/LHA ..in the next 12 months ..81
Table 7.2: Which of these reasons have contributed to your intention to continue letting to tenants
who claim HB/LHA in this area over the next 12 months? ..............................................................82
Table 7.3: Do you plan to make any of the following/additional changes in the next 12 months
specifically because of the changes to HB/LHA rules introduced since April 2011? .......................86
Table A1.1: Are you a member of a landlords association? ...........................................................92
Table A1.2: Are you a buy to let landlord? .....................................................................................92
Table A1.3: Letting of shared accommodation ...............................................................................93
Table A1.4: Demand for shared accommodation ..........................................................................93