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Landlords who refuse to let to tenants on DSS are “beyond bonkers”

Buy-to-let landlords who reject housing benefit claimants could be breaking the law.

A recent legal case which saw single mother Rosie Keogh win compensation for sex discrimination from a letting agency that refused to consider her as a tenant for a property in the Kings Heath area of Birmingham after she revealed that at least part of her rental payment would come via benefits is a stark warning that landlords and letting agents who refuse to rent to housing benefit claimants could be breaking equality laws.

A survey of 1,137 private landlords for housing charity Shelter last year found that 43% had an outright ban on letting to such claimants. A further 18% preferred not to let to them.


Ajay Jagota, managing director of deposit free renting firm Dlighted, described some landlords’ decisions to ban benefits tenants as “beyond bonkers”.

He said: “We like to tell ourselves as an industry that the bad old days of ‘no dogs, no blacks, no Irish’ are behind us, but sadly it seems a significant number of rents are still being discriminated against in 2018 – and it doesn’t have to be that way.

“By the looks of things fewer and fewer landlords and letting agents are willing to rent to tenants on  housing benefit tenants, most probably as a result of welfare reforms making them anxious about possible rent arrears.

“And they’re absolutely right that the old-fashioned tenancy deposit provide negligible protection against rent arrears and zero protection against legal costs – especially compared to the £600,000 of cover provided by deposit-free renting using deposit replacement insurance.”

Jagota believes that standard tenant vetting does not provide landlords with enough information about prospective tenants.

“Landlords and letting agents might decided not to rent to a tenant with a lifetime track record of reliable renting because standard tenant vetting won’t let them see that,” he added.

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    The Government have created this issue.. I had a tenant on Housing Benefits (actually a friend of my sisters coming back from abroad). He had to wait 3 months for his housing benefit which we helped him get (went to interviews with him).. When he got it, he spent all the money on new clothes, laptop, iphone etc.. He was better dressed than me and I'm a millionaire.. Housing benefits or the Police were not interested that he had effectively stole from the state.. He still ows me £3.5k, 8 years on and has disappeared. The resulting situation is my houses which were due to be renovated are only just being done.. so effectively its cost me over £40k in lost rent.. Last tiem we do somebody a favour.


    did you get ccj against him?

  • SCN Lettings

    "Could be breaking the law" - so not a resounding "is". Settled out of court so no stated case. Are landlords bonkers for not wanting to risk their investment? And deposit replacement insurance. How does that fit in with rent insurance guarantee where you have to take a months rent AND deposit on a policy to make it valid. And an obvious plug for Dlighted and Mr Jagota who compares landlords who avoid DSS as racist. Not a good article.

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    Morning Guys,
    Just for clarity, we are finding that certain "buy to let lenders" are stipulating that landlords cannot rent their properties to benefit clients. Not saying this is right or wrong, but the article does suggest its the landlords/agencies who are unwilling. The article is also written by an insurer which does slant their view slightly . Happy to listen to all sides.

    Kristjan Byfield

    I always feel a great way to win over potential clients is to call the way they conduct themselves professionally as bonkers.

  • Kristjan Byfield

    Most agents and landlords do not discriminate benefit tenants for reason pf 'class' but find it hard to fully vet the fiscal risks and admin headache that often comes with them. The three key issues are that: 1 councils pay rent in 28 day sums in arrears rather than monthly in advance causing an accounting headache for many as well as a months (further) delay in income 2 If the benefits are found to be fraudulently/inaccurately claimed the landlord must immediately return all applicable funds to the council and then pursue the tenant through the courts (which if the need support is largely pointless) 3 councils still by and large require a benefit tenanted to be evicted before they can be housed elsewhere. As such, how can an agent/landlord opt for a benefit tenant over a professional/private income one with these risks? It's not bonkers, its business sense. The councils can make some easy tweaks to make their tenants potentially more attractive than private tenants- underwrite/guarantee all applicable rent and damages, offer free legal assistance in pursuit of arrears and eviction matters. These changes would solve the issue for many.

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    Too many articles from Dlighted on this site. Why?....... are they part of landlord today? Most of the articles are anti landlord.. we are providing good housing for people who want to rent not buy.
    I am owed tens of thousands over the years from housing benefit tenants with no point in chasing people who have no money and they know that. I used to house the most vulnerable but became like an unpaid social worker helping with paperwork, meetings with the council, unravelling 'stopped' benefits and even lending tenants some money whilst their benefits got stopped. How can that be unreasonable behaviour of a landlord? When the housing benefit was cut substantially from around £80 a week to around £60 in my area, I realised that it would be WRONG and unethical of me to take benefit tenants who had NO way of paying the additional £25 a week and living too and I would be putting them in a more vulnerable position and more likelihood of debt. We cannot be made to be responsible for the Government's decision to cut benefits. We know the benefits bill is too high but I have heard too many of my tenants in the past saying there is no point going to work as they would lose their benefits and then if the work ended they would have to start all over again and it would make their housing situation untenable. I understand this position, so why can't we encourage people to work, deduct only a percentage of any work they get until they reach an income of around £15k a year which is then self-sustainable. We need to educate the unemployed, teach them how to deal with money, get rid of crazy loan interest to the most vulnerable (would you or I pay over 100% interest on money.... no). There is nothing 'breaking the law' about the right to choose your own tenants to live in your property yourself. I choose tenants who can afford to pay the rent I charge. Councils should not be encouraging tenants to stay until there is a court order for them to leave (do they not understand the £300+ cost of the court papers are also going on to the debt?). This country needs a shake up when it comes to housing and I'm not sure the new Minister has any knowledge at all in her new field.

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    I wholly agree with Elizabeth Beckett. Belvoir - which I use - I also choose tenants for my unfurnished properties who can afford the rent, which is set just below (as far as possible) local levels. Housing benefit is substantially below my level but if the claimant can pay the difference through a DD, that is fine. As it happens I have only had 2 claimant tenants (out od 25 +) in the past 10 years. One was fine and moved on but the other suddenly stopped paying and had to be evicted at considerable cost. Altruism can be risky!

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    sorry work shy benefit claimants we don't want you and for good reasons, the ball here is in the government's court make it worth while for us to take benefit claimants, but i'm not holding my breath here

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    EB - most ministers have not the faintest idea of the field they have been appointed to by our elected dictatorship government and the whole system is at risk. Caused by - our government with taxation rubbish management and poor admin. Any private sector firm employing these tactics would fail in the very short term.

    Had a lender who specified, no DSS and no students. Not unusual agents and landlords have to say no and they are not breaking any law by following the guidelines of the lender they are merely following orders from a higher authority.


    This is also our experience with lenders

  • Carla Keegans

    Interesting topic, and thread! Few points that I'd make: 1. most agents in my experience (running this agency and my housing career previously) do not know how to navigate the benefits system, therefore they do their landlord customers a disservice, as well as often their tenants by letting rent arrears build-up. 2. many self-managing landlords also don't have necessary knowledge or experience/skills, and how can they when most aren't doing it as a full-time job. 3. the PRS is markedly changed in the past decade and the whole sector needs to catch-up. Benefits is a hugely important issue in this context. for example, almost 50% of private tenants in Teesside are in receipt of housing benefit/UC. Many of those are in work but on low wages/insecure/PT employment, where tenants are often doing everything required of them but it is the authorities that make mistakes. In summary I'd say: a) agents need to be equipped with the necessary skills to manage tenancies in this changed PRS. b) landlords should demand more from agents who blame the system but actually it's down to agents lack of experience/skills of dealing with benefits. c) landlords also need to weigh up risk in this changed PRS (that will continue to change), and decide if they still want to pursue being a landlord (or, use an agency such ourselves that bring years worth of housing experience to deliver effective letting and management services in this changed PRS!). Carla Keegans, Director.

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    Universal credit has made this problem worse. I always rented to Housing benefit claimants but you can not work with Universal credit. They don't have a form for direct payments to private landlords & they are very unhelpful.
    If they had a online form like my Council I would be more likely to start taking tenants on benefits again.
    They also put a tenant on direct payment to him when they were moved onto Universal credit even when the Council were paying direct to landlord because he has a drug addiction. How stupid is that .

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    • 13 April 2018 08:41 AM

    Bonkers not to take them? Are you mad?

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    Ok this is how I rent out my properties.
    No DSS, No Benefits, No Universal Credit.
    No persons who cook a curry or chinese food every day.
    No animals.
    No body who cannot show Savings and or Earnings and if I require Guarantor who can cover the rent ontop of their outgoings.
    Nobody who is supported by the council a church or similar.
    Will take workers in a Full time permernant secure job.
    Very good credit rating.
    Perfect references.
    Perfect ID.
    Show bank statements as well as wages for past 6 months.
    Employers reference.
    Never ever take a person put forward by the council.
    Result, no arrears, no more wrecked properties,no anti social tenants, no drug use, no mortgage arrears.


    You are very lucky that you are able to demand such things from your tenants.
    Also, I am not so sure that there is anything that can be described as a 'secure' job any more as there is now no such thing as a 'job for life'?
    Where I am based, quite a large proportion of tenants are on some kind of benefit even if they are working, so you would have a lot of empty properties if you required a tenant to 'tick all the boxes'?
    It's not that I disagree with you, it would be just unworkable in most areas outside the South East and other affluent parts of England.

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    Horses for courses and yes location wise Can differ but solid ground rules must apply and "permanent" job status is very important.

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    Unfortunately, I have a tenant who has a permanent job and is over two months in arrears?
    However, I am mindful of the fact that he doesn't earn that much and this has contributed to the situation.
    In future though and 'with the benefit of hindsight', I will have to be more diligent and make sure that their income stream is sufficient to fund the rent.
    In over twenty years of renting, I now find myself in the situation that most contributors on here have experienced, in having to evict tenants for arrears.
    They are not acknowledging the notices served upon them, so the next step is probably an expensive court action?
    I will definitely learn from this and bear in mind some of your suggestions.

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    I've been waiting for this to crop up for years. I have one DSS tenant in my block of 10 flats. He is on medical benefit (got hit on a zebra crossing) He's always paid on time and been with me 15 years. I'm selling all my property because being a Landlord is not a good thing anymore. 9 tenants found new accommodation straight away but my DSS was advised by the council to stay put until I have to go through pain suffering and cost to get him out. Then when he's homeless they will rehouse him. So my argument is if they want this housing crisis to get worse carry on and do this to other Landlords and they will all find ways of not letting to DSS. They want the housing crisis to get better-find a way to work with Landlords so they can guarantee the Landlords will not have- rent arrear issues, bad anti-social tenants, none of this 'do not leave' crap! Oh and by the way what about the insurance companies that will not insure a building if there is a DSS tenant in it? If you guys did'nt know that you best check your policy! Landlords are the way out of this crisis and until government recognise this it will only get worse!

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    g b --contact local govt ombudsman


    The only proof of that is the tenant told me but I know it goes on. I ask the homeless office guy that this was unreasonable and he said he only advised him what his rights were! Infant any tenant DSS or not have this right. Thank god they don't all put it into practice!


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