Quote:
Originally Posted by Ramrod
That's an interesting way of looking at the world but the reality is that a landlord can only charge the market rate for the given location & quality of premises.
If the landlord charges much more than that he/she will find that they have no takers for their accommodation and it is left un-tenanted......costing them money every month.
If you look at rent levels, property purchase costs, tax & mortgage costs etc, you will find that there is very little wriggle room when it comes to what rent a landlord charges and their profit at the end of the month.
As landlords, we don't just think of a figure and charge it. We wouldn't stay in business very long  |
This was the ideology behind the Tory idea to remove rent controls ie the market will decide.
The problem is that they then went back on their initial promise that they would even be prepared to let the HB bill increase if (when) rents levels increased.
Slowly but surely, using various methods such as restricting the maximum amount payable to "a reasonable market rent" decided by the Rent Officer, the use of Local References Rents etc, the amount of HB for privately rented properties has been eroded.
This means that tenants either have to renegotiate a lower rent with the landlord or pay the shortfall out of monies intended for day to day living expenses and pushing them below the poverty line.
In reality, like you say, if landlords know that nobody else wants the accommodation or is willing to pay any more than HB will pay, then it's better to accept the lower rent than have it empty.
However, this often leaves benefit claimants with the dregs that nobody else wants.
The other problem is that if the market rents reach such a level beyond which HB will pay, you have what some regard as 'population cleansing' as people are forced out of certain areas.
Many Londoners who were born & bred there for generations (particularly those who find that they happen to be in an up and coming area) are being forced out by people who can afford the extortionate rents.
As this continues, there will be whole areas devoid of any poor people and whole areas where nothing but poverty exists.
I don't think that this is any good for society as a whole, particularly with all the hot air that polticians spout on about "The Big Society", " Social inclusion" etc.