More than half of private landlords say their tenants on Universal Credit have fallen behind on their rent payments in the last twelve months.
A survey by the Residential Landlords Associations (RLA) found that 54% of private landlords have tenants in receipt of Universal Credit who have rent arrears, putting them at increased risk of potential repossession.
Of these, 82% said that the arrears only began after a new claim for Universal Credit or after a tenant had been moved to the Credit from housing benefit.
And 68% of landlords said that there was a shortfall between the cost of rent and the amount paid in Universal Credit.
Landlords can ask the Department for Work and Pensions for rent to be paid directly to them, instead of to the claimant, but the RLA says it takes an average of 8.5 weeks for this to be set up.
The problem have become so dire that 62% of landlords fear their tenants won’t be able to afford rent payments when they are moved to the new benefits system, which is expected to be completed by December 2023.
Figures shows that almost half (45%) of current Universal Credit claimants rent in the private sector, which is widely known to be more expensive than renting in the social housing sector.
The RLA is calling on Government to give all Universal Credit claimants the option of having rent paid to their landlord from the very beginning of the claim.
They also say the minimum five-week wait for an initial payment should be scrapped, and also that the freeze on Local Housing Allowance should be ended.
David Smith, Policy Director for the RLA, said: “Today’s research shows the stark challenges the Government still has in ensuring Universal Credit works for tenants and landlords.
“The system only provides extra support once tenants are in rent arrears. Instead, more should be done to prevent tenants falling behind with their in the first place.
“Only then will landlords have the confidence that they need that tenants being on Universal Credit does not pose a financial risk that they are unable to shoulder.
“Without such changes, benefit claimants will struggle to find the homes to rent they need.”