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