to think the south east has started to expel the poor

[ubik]

www.guardian.co.uk/uk/2013/feb/13/london-council-relocation-benefits-cap

Basically Camden Council cannot cover the housing benefit for these families due to government cap on benefits. These families would have to find an extra £90/week to make up the shortfall. As I understand it, there is nowhere in the south east cheap enough for these people to live.

So they are considering moving them to a cheaper region up north, hundreds of miles away from their families, schools, jobs, friends, neighbours.

I find this incredibly depressing as someone who grew up in a normal family in London.
Is the south east expelling the poor?

I get what you mean TSC....don't think all LL are like this though....not all are getting their rent from HB. many cannot take tenants on HB.

Well, to be fair, I have been known to do that too, TSC.

A relative lives in very central London in a one bed ex council flat. Within his block there are a number of single people in 3 beds who will have that flat for life. They are not working. Some are early retirees. But they are being paid for by the taxpayers. His neighbour has never worked and now in retirement (from what I wonder!) she is able to stay in her 3 bed until she dies.

Is this right. Yes, they have lived there for a long time but we all need to move for various reasonsover our lifetime.

I know a few landlords. In this area you'd be looking at a mortgage of £500 per month against a rent of £650. That is broadly on a 2 bed property with 75% deposit. That is on an interest only mortgage.

After rental agency fees are paid that doesn't leave a lot. Maybe a bit to save up to allow for void periods or repairs.

I don't see that is going to pay landlords mortgages to give them a free house. The landlords I know are all in it for the long haul, looking for capital gains. When they are done they will sell the house and realise the gain in that way. Probably they will have made on the original investment (the deposit) but they do not have a free house!

Jake-more than 60% of all renters claim some HB, so whether ll's know it or not, a very significant proportion of their income comes from HB.

The problem is the whole buy to let bonanza. The WORST landlords are the little ones, who have jumped on the property bandwagon. In my extensive experience anyway.
The whole property bubble of the last few years inflated house prices to beyond a realistic level, and the cost of this has been passed to the government, very directly, by virtue of the fact that people cannot pay for the roof over their heads with their wages alone.
If I had been earning the equivalent of what I earn now I could have bought a small 2 bed 15 years ago. Now? No chance.
House prices have to come down. Way down.
This would bust a whole lot of buy-to-let prospectors, but then investment generally does carry a risk, no?
Pre 2000 there was a dot.com bubble, when people were hoping to get rich quick. In 2000 it burst, and a lot of speculators lost their shirts.
That is the natural consequence of actual capitalism.

With housing it is more complicated, because, actually, housing is about more than just "property". It is about homes. So the government has been propping the market up artificially.
And while the government prop up the landlords, they can pass the blame onto the poor sods who can't afford to pay their rent on pitiful wages.
And the "hard working taxpayer" (conveniently ignoring the tax paying, HB claiming renters) can come over all indignant about scroungers being "undeserving" of reasonable homes.

This is one of those issues where it's easy to be emotive and talk about the 'poor' being 'expelled from the south east'

But as many others on the thread have pointed out, this is no different to the hundreds of thousands of people who aren't in receipt of benefits who have to move because they cannot afford to live in a certain area.

The benefits cap is £24000 per annum ( actually higher than this in real terms once other fringe benefits are factored in) So what's that? - the equivalent of at least 30k gross salary. I don't see how anyone in their right mind can argue against a cap which is significantly above the average earnings.

I entirely concur with those who have said house prices are way too high compared to earnings, and that we need more housing and social housing in particular. Abso-bloody-lutely.

But within the situation which currently exists, its unreasonable to expect non recipients of benefits to move if they can't afford to live in a particular location any longer, yet protect a benefits recipient from that.

TSC - blimey, aggressive or what?!

I didn't say the benefits recipient receives all the 24k to spend how they like. Obviously a significant proportion is going to the owner of the property. Just as a wage earner who isn't on benefits is paying out most of their income to the landlord (or council for council tax etc....)
The point is, it's been possible to benefits recipients to live in areas which many non recipients are priced out of. I don't see how anyone can argue that that's an equitable situation. If you're saying the govt should protect people from having to move from an area they can't afford, then let them do it for everyone. Though I would be interested to see an analysis of how that's affordable

TheSecondComing - people will still do these jobs. They will commute in from outlying parts of London where they will live in cheap accommodation. Maybe a bit like this: <a class="break-all" href="http://search.babylon.com/imageres.php?iu=i.dailymail.co.uk/i/pix/2011/10/22/article-2052051-0E7A1ABF00000578-370_634x522.jpg&ir=www.dailymail.co.uk/news/article-2052051/Suburban-slumdogs-Scores-desperate-migrants-crammed-shanty-town-sheds-garages-ruthless-landlords-No-Mumbai--London.html&ig=t2.gstatic.com/images?q=tbn:ANd9GcTMFn_CA8o4tjVf30Vw-H6DSXGjKDJWn8_eHevGwm5b43isouRhbY76lXQ&h=522&w=634&q=southall+shanty+town&babsrc=SP_ss" rel="nofollow" target="_blank">slum

If they have children they won't see them, as they'll be out the house from 5am to 8pm. If they're single parents they'll have their children in breakfast club and after school club, or nursery, mostly paid for by the tax-payer. If their children are secondary age they'll be spending hours alone at home, waiting for parents to get back from work.

Those people who will be moved out of central london will have to take their children out of school, no matter how close they are to doing GCSE's or A-levels, and regardless of whether they can find a school place in the places they get moved to.

Really, it fucking stinks.

As I've said before, this will only affect around 1% of the population. There will still be plenty of housing benefit claimants who live in social housing, of which there is plenty in Camden, Haringey, Hackney and most other London Boroughs.

It's not as though all benefit claimants are being moved out of London. Only those whose capped benefits will no longer cover their private sector rentals.

There will still be plenty of people living in London to do NMW jobs.

There is a lot of confusion about how benefits work.

Housing benefit is worked out by assessing how much landlords are charging for the lower third of rental stock in an area.
At the same time every person is considered to need allowed a set amount to live on, by law.
For example, say a single person with one child is deemed to need £125 a week to live on and buy food, pay bills etc after their housing costs.
That £125 can come from any source-earned income, JSA, anything.
The local housing allowance for a single person with one child is £500, for a 2 bed flat.
If the person can only find a flat for £560 a month, they are left with around £110 a month, and so on.
The amount a person is entitled to is the same for everyone, whatever their circumstance, number of children are the only variable.
All benefits are worked out to allow this minimum amount, although most people actually pay a proportion of their minimum towards rent, because in most parts of the country the LHA doesn't quite cover what they can find to rent.

Now say the person starts to earn more money. A proportion of Housing benefit will be deducted , but only based on 65% of their earnings. This allows the person to be better off working than not.
As they earn more and more, HB is deducted until they no longer get any (as it should be.)

This nonsense about people pulling in 30 k on the dole is just that-nonsense.

Fact 1. You are better off employed, free school meals or not.
Fact 2. The more you earn the better off you are.
Fact 3.A family earning 30 k would still be entitled to some housing allowance IF their income did not meet minimum requirements after their rent up to the local housing allowance had been taken into account.
The rules are the same for everyone.There is no gaming the system, beyond actual fraud.

Sorry, that should have said "£110 a week"

Oh come on, there are many parts of London where low income people can and do live and make ends meet. This issue has so much hysteria around it, I'll believe in the so called social cleansing when I see it.

Ifnotnow
My life is far from shit. My point was merely that I don't expect other people to subsidise us living in an area we can't afford.

Lots of people are moaning about private landlords, but it's all about supply and demand. The HB culture has created the demand and landlords have supplied the properties.
If HB wasn't as high in the first place then the landlords wouldn't have been able to charge as much. If capping it drives HB claimants away then at least over a period of time rents will stabilise to reflect what people earning can actually afford to pay instead of bring artificially inflated with tax payer's money.

Drives them away where?
Because anywhere in the country where there is work, the rent will be high.
Where are the newly homeless HB people supposed to go?
HB isn't a "culture". It is nessessity when rent costs half your yearly earnings.

And they HAVE cut HB. It has had absolutely no effect on rents at all.
All that has happened is that, since the allowance is less, there is more competition for the lower end of the housing market.
Last time i was going to see a house to rent, the agent called me and said someone had already taken it sight unseen.

This is a ridiculous thread. £500 a week is £2000 a month. I live in London in a non trendy part of London 20 minutes from Waterloo. £2000 a month would get u a nice family home thank you. What's more I work full time and would LOVE £2000 to spend on housing a month. So maybe they can't afford Camden but there are plenty of areas in London where that is a reasonable rent. Thank god for the cap and some common sense

We drove through Farnborough today and I commented to DH that it looked so run down and the people really looked "poor". Not what I would expect to find in the South East at all. It reminded me of the towns and put villages in the NE.

In fact there are just under 27,810 HB claimants in LB Camden.

16,204 are Council tenants.

6712 are Social Landlord (eg HA) tenants. So the vast majority of HB recipients in Camden are in council or social housing.

Just 4894 - 17.5% are private tenants whose housing benefit goes to the "greedy" BTL landlords. Of those, 84.5% will remain where they are. 761, claimants or 15.5% of those in the private rental sector (2816 adults and children - just over 1% of the population of Camden in total) will be required to move somewhere more affordable.

Social cleansing? I hardly think so.

So we can also see that the vast majority of HB in Camden - 82.5% - goes to the Council, or to Social Landlords.

By the way, landlords pay tax on any net profit they make, and when they sell they will pay capital gains tax on their net gains of 18% (or 28% if they are a higher rate taxpayer).

In all, the the UK private rental sector is worth £500bn and contributes £30bn each year to the UK economy.

Just thought I'd say...

I agree with olgaga's point above. There will be plenty of residents left in Camden and other parts of London to do NMW jobs, because the proportion of social housing is generally quite high in London compared to the rest of the UK.

Some useful data here in Camden's Housing Strategy Evidence Base - 26% of households are in council-owned housing (compared with 13% across England & Wales) and an additional 11% in other Social Housing. These people won't be affected by the cap at all - so over a third of households in the borough who are likely to be on lower incomes and will be able to continue to live there and do the NMW jobs.

Why are rents so high in London in any case. And why are they so heavily subsidised by housing benefit. How can it be right that somebody in another part of the country earning say £12,000 a year is paying tax to help subsidise people on £500 a week housing benefit. It is a totally crazy system and should never have been allowed to develop. It is Labour's fault. I voted for them last time but won't be again for the forseeable future if ever.

And just for good measure, this is what HM Treasury said in a recent consultation document:

The Private Rented Sector (PRS) plays a critical role within the housing system, helping to meet growing demand and providing a flexible tenure choice. It has also played a disproportionate role in funding new-build supply in recent years. It is important that the sector continues to grow and develop to help meet the housing challenge, and that it is able to respond effectively to changing demand.

It is clear that the level of investment directed by individuals and institutions into the PRS will be key to its future development, and will strongly influence both the volume and quality of supply.

As the housing market recovers, we need to ensure a strong supply-side response to support the recovery. The PRS is an integral part of this - a key issue will be how well the sector responds to changing demand, and the level of investment directed by individuals and institutions into the sector will be crucial to that.

So, is that clear? No PRS, no new building of affordable homes. We need it more than they need us. There are plenty of other investment vehicles which don't involve providing homes for people who can't afford their own.

The (current) govt's response to the consultation:

The Government believes that the best way of supporting the Private Rental Sector is to restore confidence in the economy, stimulate investment, and maintain a stable financial system that supports lending and the long-term growth of the economy.

In other words, there is absolutely no way in the world this or any other govt will try to impose rent controls or any other controls on the PRS. There will be no change to the policy of encouraging investment, tax levels will be left alone, and people should be encouraged to "rent-a-room" to provide more "affordable" accommodation.

You can read the full response here if you like.