Reaping The Benefits - Local Housing Allowance and Universal Crdit Best Practice

1. Reaping the benefits - Capitalisting
on Local Housing Allowance and
Universal Credit Best Practice
By Philip Wheeler and Richard Jones

2. Help you to understand the benefits system.
Allow you to sidestep the common pitfalls .
Improve your skillset so you understand the process.
As Mary says ‘we’re all one P45 away from a
housing benefit tenant.’
Answer any questions you have.
Objectives of the Presentation

3. Started investing in property in 2003
Bought Student, HMO and Single let properties
Met Richard at the Landlord and BTL Show 2010
Took copious notes and tried to implement his method
Implemented parts of the system
Made mistakes
Called Richard
Wrote a book on the system
Implemented the system for myself
Philip Wheeler - Background

4. Housing Benefit claimed by 5.07 million UK citizens.
Paid 4 weeks in arrears
Paid to the tenant
Dependent on your income and circumstances.
Rate depends on location and bedrooms.
To be replaced by Universal Credit
(source: Office National Statistics May 2013)
What is Local Housing Allowance?

5. LHA Bedroom Calculator http://goo.gl/aG619e
LHA Rates http://goo.gl/r8t6yT
Birmingham & Solihull
Checking the rates of Local Housing
Allowance
Type Birmingham Solihull
Shared Accommodation
Rate
£243.58pm £299.22pm
One Bedroom Rate £420pm £497.51pm
Two Bedroom Rate £511pm £638.73pm
Three Bedroom Rate £549.99pm £741pm
Four Bedroom Rate £715.39pm £1022.02

6. Choice - Endless supply of tenants
Fewer voids
Longer tenancies
Better use of time
More profitable than other strategies
Duplicable
Easier referencing that ‘traditional tenants’
Why Bother?

7. Forgetting to sign a permission mandate allowing you
to discuss the claim with the council.
Data Protection Laws used against you to stop you
discussing the claim.
Solution - DWP Implicit Consent Wheel.
Common Mistakes – Permission
Mandates

8. Deposits create more work for Landlords
Not taking deposits outweighs the costs of taking
them especially for this client group.
Benefits tenants can rarely come up with both
advance rent and deposits.
Prevents you making silly mistakes.
Application fee £95 single person £150 couple.
Mistake #2 Taking a deposit

9. White goods are unnecessary.
Choose the correct floor coverings.
Tackle condensation before it happens.
Fix problems in advance.
Be proactive rather than reactive.
Mistake #3 Furnishing the Property

10. Wastes your time
Do not under populate or overpopulate your houses
Quickly determine your target market
Avoid bedroom tax
Ask the right questions
Mistake # 4 – not qualifying tenants

11. Giving keys to tenants before you have comfirmation
that the council will pay the required rent is a
common mistake.
Leads to eviction in most cases due to poor
referencing.
Mistake #5 Premature Handover

12. Forms based system
Follows DWP best practice guidelines
Avoids mistakes
Checklists create a robust end to end system
Identifies best tenant from your selection
The System

13. Tenant Enquiry Form (Benefits/working)
Passport Benefits (income assessed)
Job Seekers Allowance
Income Support
Pension Credits
Family Size Matches property.
Check out Current Property
Contact Council
Arrange Move in date
Payment calendar
The System - Steps

14. Questions?