Housing Benefit Discrimination

In 2018, Rosie Keogh won a case for indirect discrimination against a Birmingham letting agent. Keogh was a single mother who needed to pay for some of her rent with housing benefit.  A letting agent with a No DSS policy, who refused to consider her for a property, was deemed to be discriminating against women, especially single women.

The housing charity Shelter, and the National Housing Federation have this week taken the case further and ‘named and shamed’ letting agents who could also be at risk of discrimination. 149 branches of five leading letting agents were called by mystery shoppers revealing that 10 percent still had a blanket ban on housing benefit applicants. Of those other branches, almost 50 percent had no properties available for people on housing benefit at the time.

The report claims that a shortfall in social housing means that an estimated 1.64 million adults rely on housing benefit to help cover private rents.

It said the majority were women, and especially single mothers with childcare responsibilities, while people who receive disability benefits were three times more likely to need a housing benefit top-up.

Housing Benefit Discrimination: The Reasons Why

There are several reasons why landlords and letting agents choose not to accept housing benefit applications.

• Clauses about ‘working only’ in the landlord’s mortgage or insurance agreement
• Caution about the tenant’s ability to pay rent regularly and on time
• Fear that the tenant will be a ‘bad tenant’ in some other way
• Avoiding dealing with the local authority

Mortgage and Insurance Agreements

This is the main reason New Mills Properties is occasionally unable to offer accommodation to people on Housing Benefit. Perhaps in this situation, a case for discrimination should be brought against the mortgage or insurance company and not the landlord or letting agent.

Ability To Pay Rent

While universal credit is being rolled out, this is a particular concern for landlords. In addition, housing benefit or the housing element of universal credit is usually paid in arrears.

David Cox, chief executive of letting agents’ body Arla Propertymark, said: “Rents are paid in advance, whereas housing benefit is paid in arrears, and therefore with such a shortage of rental accommodation, landlords and agents will naturally choose a tenant who can pay the rent when it is due, rather than a tenant who is always a month in arrears.

“We have called on government time and time again to resolve this problem. But our calls have fallen on deaf ears.

Few landlords can cope with long periods without payment. Taking into account previous payment history and asking tenants to provide a guarantor will go some way to protecting landlords. This is standard practice at New Mills Properties.

Bad Tenants

Of course, there will always be bad tenants and some of them will be in receipt of housing benefit. But we have often found many good, and indeed, some of our best tenants in receipt of benefits.

The Local Authority

We acknowledge that in some cases, dealing with the local authority can be difficult. We have found that in North East Lincolnshire at least, the staff are doing their best with limited resources. Sometimes this requires patience on our part but we get there in the end.

Housing Benefit Discrimination: What To Do

The first thing to do is check the wording on your mortgage and insurance agreement. If it expressly states that you are not to house anyone in receipt of benefits then you need to make it clear to your letting agent. There is not much more you can do to change the situation, short of switching providers.

If there is any other reason that you choose to reject an application from one person over another you should make it very clear why it is. If you reject someone simply because they are on housing benefit you could be at risk of indirect discrimination.

For more advice please call the New Mills Properties office on 01472 360178.

The following is a short video of a discussion on the subject of housing benefit discrimination on the BBC programme, Victoria Derbyshire.

**Update March 2020** It seems that this issue is a continuing one. Another two women have brought successful claims against letting agents for refusing them a house because they are on housing benefit.