Half of landlords wouldn't let to tenants on housing benefits - but the government plans a crackdown

Published by Edmund Greaves on 01 March 2019.
Last updated on 01 March 2019

Landlords with limited companies may earn £1,000 less a year

Thousands of households who receive housing benefit face discrimination and being denied access to rental accommodation, a new report suggests. 

According to the Ministry of Housing, Communities & Local Government (MHCLG) around half of landlords say they would not be willing to let to tenants on housing benefits.

As a result, the government says it plans to investigate letting adverts that discriminate against would-be tenants on housing benefit.

With 4.5 million households in rented accommodation, and 889,000 of these in receipt of housing benefit, it is possible that thousands of vulnerable people could struggle to access the rental market.

Minister for family support, housing and child maintenance, Justin Tomlinson says: “Everyone should have the same opportunity when looking for a home, regardless of whether they are in receipt of benefits.

“With Universal Credit, payments can be paid directly to the landlord, and we continue to listen to feedback and work with landlords to improve the system.”

Minister for housing and homelessness Heather Wheeler MP adds: “I want everyone to have the security, dignity and opportunities they need to build a better life – at the heart of which is ensuring everyone can find a safe and secure home to call their own.

“I will also be meeting key stakeholders to tackle the practice of ‘No DSS’, to underline the need for immediate change.”

Landlords’ response

The Residential Landlords Association, which represents landlords across the country, says its own research has found that the average amount owed by tenants in receipt of universal credit increased from £1,600 n 2017 to just under £2,400 in 2018.

High street bank NatWest today also announced it was scrapping restrictions on landlords with buy-to-let mortgages from letting homes to benefit claimants. The RLA says its figures show two thirds of the largest buy-to-let lenders don’t allow landlords to let property to tenants receiving housing benefit.

Responding to the announcement, John Stewart, policy manager for the Residential Landlords Association says: “Landlords should not refuse someone solely because they are on benefits, and should consider prospective tenants on a case by case basis.

“But with growing numbers of benefit claimants now reliant on the private rented sector we need to do more to give tenants and landlords greater confidence in the benefits system.

“This means giving all tenants the right to choose if they want to have the housing element of Universal Credit paid directly to their landlord, working with bank lenders to remove mortgage terms that prevent landlords renting to benefit claimants and ending the Local Housing Allowance freeze which has meant benefits bear little resemblance to rents.”

Paul Wootton, director of home proposition at Nationwide Building Society, adds: “Everyone should be able to access a safe and secure home suitable for their needs. The continued presence of ‘no DSS’ restrictions in the private rented sector is unfair and denies this right to a significant group of people.

“Nationwide does not put this type of restriction in its buy to let mortgages and we urge others – lenders, agents and landlords – to act now to change this outdated practice.”

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I am a private landlord

I am a private landlord currently with one small property. With a managing agent to screen my clients, I, personally, have no problem with tenants in receipt of benefit - i.e. Universal Credit, from which they can pay their rent.

The result in my view is that I know they have an amount coming in regularly which can cover the rent. Those of us who are self employed have no such luxury.

The article fails to mention insurers. Each time I have entered the murky world of insuring my property, navigating the problems of being unable to insure a property if it is vacant - even a void between tenants (thanks Direct Line - Mr Wolf doesn't mention this stuff in the ads) - I am asked to declare that,amongst other things, the tenant is employed. The suggestion (direct & implied depending on the insurer) is that someone on benefit will create a problem - I suspect a higher premium, if cover at all.

(What benefit and work mean seems a murky world of movable goalposts. Child benefit anyone?)

As my managing agent pointed out, if benefit claimants were excluded, then the majority of properties wouldn't let.

Maybe the problem is not just landlords...

I've been a landlord for over

I've been a landlord for over 20 years and experienced the nightmare of tenants on housing benefit. My experience has been that the local council HB dept are uncooperative, awkward, obstructive and extremely slow in processing claims. I will never again let a property to a housing benefit claimant when I can get good tenants who work. I choose my tenants NOT the government's Minister for Housing.

A private landlord should

A private landlord should have the right to decide who they are renting to or not. If the government wants to force them to rent then any rent arrears or damage should be compensated to landlords from MP's and Lords pension pot, they can then claim it back from those who they expect others to trust, failure to get it back will reduce their future pensions, that way they may think differently. If they can't prioritise their rent payment house them in shipping containers to the value they pay. There is too much protection for those that don't care.

Is the government going to

Is the government going to indemnify landlords?

We have had a Let property since 1982 (was in the military) and have had one crook (took the property with no intention of paying rent) and two DHSS tenents. The latter two left us more out of pocket than the crook! After the second out-of-pocket experience, we joined the “no-DHSS” brigade.

Major problem with letting to

Major problem with letting to dss claiments is that they are in all day, have too many friends around, usually not such good neigbours, cannot afford to keep houses as nice as working tenants, end up keeping pets etc etc so more wear and tear. Landlords responsible to pay back rent allowances to council if tenants circumstances change ( i. e. If tenant gas boyfriend move in and don’t tell council) Simply too many reasons to list! Do gooders should not interfere when they have not experienced the drawbacks.

The government created this

The government created this problem years ago by stopping direct payments to landlord in the first place. Now they are accusing landlords of discrimination! Give me a break! A lot of vulnerable people receive DSS benefits or my have addiction problems as well. Local government Association warned in 2010 that this exact same problem could occur by expecting claimants to budget and pay the landlord themselves. Why punish landlords for protecting their financial position due to government stupidity here?

I agree in principle with

I agree in principle with this proposal however from personal previous experience I have found that these tenants on DSS benefits do not often treat the properties with respect and the end results are reduce property values because of their state

I have and do let to DSS

I have and do let to DSS tenants but besides some having different lifestyle choices to many, there is always the complication that benefits are paid 4 weekly (i.e. not calendar monthly) in arrears and those that only receive partial housing benefit have to make up the difference themselves.

Besides this additional layer of managing rent payments, when payments are made direct to the claimant they don't always put paying their rent as their priority or see that housing benefit is being made to them for specifically for the purpose of paying their rent.

Councils' making the benefit payments are not interested in resolving any issues that arise except when it comes to thecrunch and tenants are lierally about to be evicted. Almost without exception (in my experience) the cost of eviction and the costs of repairs to the home when you finally get your property back is high.

These are just some of the issues that need to be addressed if the PRS are to be more accepting of Housing Benefit claimants.

More about housing

More about housing

With my ever shrinking

With my ever shrinking portfolio of BTL properties nobody is going to dictate to me who I have as a tenant. This is just another nail in the BTL coffin.
With all the draconian changes to the BTL landscape I am selling up one by one. The rewards now are so low and the hassle so high, and growing I have moved to greener pastures. In a nutshell BTL is dead.

George Osborne is responsible

George Osborne is responsible for many of the homeless with his tax grab on landlords which in turn put rents up . I do not see any of his ridiculous ideas have ever been reversed by this government. All I see is blame the landlord, for this governments greed with taxation which will only increase rents more

Hi i lived in surrey for 30

Hi i lived in surrey for 30 uears after lesving Durham. I made a life down there in my last house for 12 years, till last year the landlord got repossessed then got it back then sold to developer. Soa block of 18 flats with multiple tenants per flat a church underneath my house and my ec husbanfs garage of 12 years all served notice except garage last year. Iam registered disabled and have a 10 year old boy been looking since last year no one would rent to me as on benefits hence i have had to leave surrey which is where mine and my sons lige was to come up north 3 weeks ago. Iam so upset and still sharing my daughterschouse. On top of that my house was in such a bad stste of repair they never came to fix it even to the dsy of bsilligs coming. Councils response via email well they wont come and repair now anyway ypure leaving. Pics can be provided environmental health was ingormed but the new landlords lied snd said i wouldnt let them in. Hsd no electric since December 2017 bare wires broken plug sockeys wites hanging toilet not flushing snd outside drainage not connected properly hence dishwasher and washer pipes leaking all over yard. Iam so depressed. This behaviour is unacceptable. Kind regards Sharon.

So what happens when your

So what happens when your “good Tennent” looses their job and no longer has an income other than benefits?