perrons davis housing benefit tenants in the private rented sector
DESCRIPTION
Our business Scale Hull, Grimsby, Doncaster, Nottingham 400 approx properties rented to benefit tenants, 87 landlords Model works in postcodes of high structural deprivation, ie. HU3 High unemployment, low incomes 90% terraced housing average house price of about £70,000, more than £100,000 below the national average and well under the HU postcode area averageTRANSCRIPT
Perrons DavisPerrons DavisHousing benefit tenants in the private rented sector
Private rented sector: it’s the Private rented sector: it’s the futurefuture
Steve PerronsManaging director
Our businessOur business Scale
Hull, Grimsby, Doncaster, Nottingham 400 approx properties rented to benefit tenants, 87 landlords
Model works in postcodes of high structural deprivation, ie. HU3 High unemployment, low incomes 90% terraced housing average house price of about £70,000, more than £100,000 below the national average and well underthe HU postcode area average
Our tenantsOur tenants Young single people living alone or with a friend Young single mums, fewer 2.4 families Older unemployed and/or divorcees High incidence of social problems: alcohol, drugs, history of crime, etc
Why they come to us.... No deposit required DSS welcome Help with local authority forms Good standard of accommodation
Our landlordsOur landlords
High-income professionals Retired people “Spreadsheet investors”, ie. Disillusioned savers seeking high returns
– Yield for landlords, gross = min. 10% net = min 8%
Hands-off, not from the local area Long-term
How it worksHow it works
Affordability Guarantors. 95% of prospective tenants can provide a guarantor Intensive management - monthly inspections , etc.
– 2 to 3% of tenants fall behind with their rent– 1% void rate– £750 = typical annual maintenance spend on a terraced house
Higher than average lettings fees to landlords Work with local authorities informally
Problems/ barriers to growthProblems/ barriers to growth
Stigma associated with housing benefit tenants Not enough contact with local authorities - don't all have the same
system ie. easier in Hull than in Nottingham Reliance upon guarantors
Shared room rate up to age 35 will have significant impact Cap has no impact in our areas 50th to 30th percentile has small effect on revenue Plan to offer direct payment for rent reductions unrealistic
Effects of cuts to housing benefitEffects of cuts to housing benefit