……was my first reaction when I first heard about it. After the much maligned
- changes to Stamp Duty on second home purchases
- changes to tax relief from mortgage payments
I may be forgiven for assuming the worst! For example, I initially wondered whether it was going to force landlords to give up rooms or even whole houses where they have been vacant for a certain length of time for social housing.
I am delighted to say I was very wrong!
The Homelessness Reduction Bill is aimed at local authorities doing more to prevent homelessness and for those who are already homeless to get them into accommodation. There is no obligation being forced on private landlords.
Phew! Now I can ignore it and carry on……..or maybe not. Maybe there is an opportunity here, particularly for those landlords with a strong sense of social obligation…….?
Prior to the Homelessness Reduction Bill, if you were homeless you needed to meet certain criteria before the councils were duty-bound to provide you with housing. For example, single mums, people with children, people with health conditions and disabilities were always given housing first.
The introduction of the Homelessness Reduction Bill changes the scope of the obligation on local authorities to provide accommodation for anyone who is homeless (including single people), or at risk of becoming homeless, at the time when such people ask for help.
So, where is the opportunity?
The Homelessness Reduction Bill is going to increase the need for single occupancy rooms in multi-lets.
There is going to be an increase in demand for LHA HMOs (local housing allowance houses in multiple occupancy).
- Do you have HMOs with frequent and long term vacancies?
- Are there any neglected buildings coming up for sale that could be snapped up for a low, low price and converted into a HMO with good profit margins left in even if sold/let for social housing?
- If offered, the local authority may take over the management of your property. You may get less rent if let privately but you will get zero voids, no management overhead and your property returned in good condition.
With social property projects, there are risks involved for you as a landlord or investor but such risks can be mitigated by working with specialists and by seeking and taking as much advice as possible.
But, if this is of interest to you and you act now and get involved with social investment, you will find yourself at the forefront of a new approach to housing which will not only benefit your tenants but also your bottom line.
If this sounds like it maybe a good idea you could look at working with the local authorities directly, pick up the phone and call their housing department.
The same applies for contacting social housing associations, let them know that you have resources to help them with housing for homeless people, as the bill starts to kick in.
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