80% rise in rent arrears is expected by housing providers
- 04 Nov
Social housing is preparing for an 80% rise in rent arrears due to government welfare reforms, reports study.
Baker Tilly, a law firm, found that the average level of rent arrears was 2.64% in the year ending 2013 but it was due to rise in 4.82% in 2014-15.
The findings are supported by Baker Tilly's back office benchmarking which found that housing providers were budgeting for debts of 1.85% in the current financial year which is up from 0.86% last year, which is a rise of 115%, reports 24dash.
84% of respondents said that they had hired additional members of staff as a direct response to welfare reforms, and a further 11% said they were planning on taking on additional staff to support their tenants through the changes.
Data suggest that approximately 73% of housing association tenants are on at least one form of housing benefit.
Gary Moreton, Baker Tilly's head of social housing said: "Social housing providers are devoting significant time and resource preparing for the potential impact of welfare reform, but there is still a great deal of uncertainty about what the future may hold for rent arrears and bad debts, and the type of housing stock required to meet tenant needs."
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Responding to the DWP Consultation: Housing Benefit Reform - Supported Housing "It was well-run, in a good location, and very useful. I've only one suggestion; as the session went on it would perhaps have been useful for bullet points of general agreement about what should be in the sector response to be displayed and added to as the session went on, maybe on a flip chart. Regarding your response paper, I particularly like the answer you give to question 9. In fact the general: "if it ain't broke don't fix it" response could be pushed harder." M.P. - Adref Ltd