Over the past few years, we’ve received a growing number of queries - from new and experienced landlords alike - relating to housing benefit. The most recent figures show housing benefit payments in Northern Ireland’s private rental sector have remained fairly steady over the past two or three years (around 71,000+) but they continue to grow, albeit slowly.
Every landlord has their own view on housing benefit – it’s always a hot topic; always provokes debate.
In an age of austerity, with housing shortages, social housing pressures and increasing numbers of low income tenants in the private rental sector, some will say opening your mind to housing benefit (armed with the facts, of course) is good citizenship as well as good business. Others see Housing Benefit (or ‘DSS’) tenants as complex and unreliable sources of rental income.
The Northern Ireland Housing Executive have produced a fairly comprehensive landlord’s guide to housing benefit which is worth downloading or printing off – but it should be noted that this document dates back to 2009 and the Benefit Cap may supersede some of the advice.
For those of you with too little time and too many emails to get to – here’s our handy Housing Benefit 101 instead…
It’s not illegal for a private landlord to refuse to rent to a tenant who will be claiming benefits. There are many reasons cited for doing so, with the biggie being the fact it’s paid in arrears, either fortnightly or four-weekly. Most private landlords want rent paid in advance, once per calendar month - so it can be tricky to reconcile those two systems. Not impossible though – just do your sums to work out the weekly rent and agree your payment dates.
Mortgage companies can ban buy-to-let customers from renting to benefit claimants, and insurance companies tend to charge higher premiums if your tenants receive housing benefit.
As soon you sign the tenancy agreement, your tenant has the right to claim housing benefit. Not only that – you have an obligation to tell them so. Under the Tenancy Terms Regulations (Northern Ireland) 2007, you must provide your tenant with a tenancy statement explaining their right to apply for housing benefit to help them with rental payments.
They just need to present evidence that they have a legal obligation to pay rent, so a rent book, tenancy agreement or other proof of making rent payments may suffice.
If the tenant receives the payment, it’s paid two weeks in arrears; if it comes to you directly you’ll get it four weeks in arrears.
Usually you’ll only receive it directly if the tenant has requested it come to you directly, has a history of late payment or is vulnerable.
The benefit of getting the payment directly is obvious, as is the drawback of the longer wait. Direct payment to the tenant means (theoretically) you get your rent sooner, and it’s also worth bearing in mind that any benefit clawbacks are potentially less complex for you if transactions remain between your tenant and the benefits office.
A full-time student can claim if they:
The contract is between you and the tenant so they owe you the money. The Housing Executive processes the claim and gives the tenant the money they are entitled to; that’s their job done.
So when it comes to late or missed payments, you follow the procedures you would with any other tenant and deal with them directly.
However, if you get to the stage where your tenant is in rent arrears to the point where you’ve issued a Notice to Quit - it’s not a bad idea to send a copy to their Housing Officer. If they have a potential case of homelessness on their hands, they may step in.