A dramatic rise in rent arrears due to bedroom tax

  • The number of household in rent arrears rose by 21% between March and June. For Rent Sign 2

    A joint investigation by the National Federation of ALMOs, the Association of Retained Council Housing and the Councils with ALMOs Group also found that the total monetary value of arrears rose by 16% in the same period.

    These three organisations, which represent over 1.3 million council households across the country, have calculated that nationally local authority rent arrears rose by £17.5 million in the first three months after the introduction of the bedroom tax. Households hit by the bedroom tax experienced a dramatic arrears rise of 59%.

    The hardest hit tenants and landlords appear to be in the North of England where the number of homes said to be ‘under-occupying' increased by an average of 104%, reports 24dash.

    Research also found that 24% of landlords reported a rise in empty properties with the associated costs of dealing with these, and 42% reported a drop in demand for some types of properties due to households struggling to afford larger homes in some areas of the country.

    NFA policy director Chloe Fletcher said: "Given the rising cost of living, local authority spending cuts, and changes to the wider welfare benefits system, it isn't surprising that councils and ALMOs are finding it more difficult to collect rent. What is alarming is the speed by which households affected by the under-occupancy penalty have struggled to maintain rent payments and the scale of unintended consequences of the reforms for housing providers in some parts of the county."

    ARCH policy adviser Matthew Warburton added: "The survey also confirms that most councils will not have enough smaller accommodation available in the coming year to enable more than a small proportion of affected tenants to downsize. This implies that arrears are likely to go on rising as tenants continue to struggle to pay."

    This research follows previous findings showing that 51% of homes affected by bedroom tax in Wales have fallen into arrears for the first time.

    Image source: http://www.sxc.hu/photo/1328867

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