Universal Credit tenants are increasingly falling into rent arrears – up by over ten percentage points since last year, according to a new study by the Residential Landlords Association (RLA).
The organisation found that over a third of private landlords with Universal Credit tenants have now said that they are in rent arrears.
The recent survey of almost 3,000 landlords revealed that 38% reported experiencing Universal Credit tenants going into rent arrears. In February last year, this figure was 27%.
The RLA’s research also found that the average amount owed in rent arrears by Universal Credit tenants to private landlords is now £1,150.
With the Government set to increase the pace at which the new welfare system is rolled out across the country from next month, the RLA is warning of a ticking time bomb without urgent reforms.
Among the changes it is calling for are measures to cut the seven-week period that claimants have to wait before they can receive Universal Credit, and measures to make it easier and quicker for payments to be made directly to the landlord where rent arrears are building up.
We have compiled a helpful guide for landlords to help you understand the new benefits system: https://www.justlandlords.co.uk/news/landlords-guide-universal-credit/
The Vice Chairman of the RLA, Chris Town, says: “Whilst we continue to welcome the principle of simplifying the benefit system, it cannot be right that, as it is currently designed, Universal Credit is leading many more tenants into rent arrears. This is not financially responsible and does nothing to encourage landlords to house people needing to claim benefit.
“We have already met with the Minister and are heartened that the Department understands the need to address the problem of rent arrears. With just weeks to go before the roll out of Universal Credit gathers pace, we need action sooner rather than later.”
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