Landlord No Longer Rents to Tenants on Benefits

High profile landlord Fergus Wilson hit the headlines at the weekend when he explained to The Guardian why he would no longer rent to tenants on benefits.

The story was the most read story on The Guardian website for most of Saturday and attracted more than 5,500 readers’ comments. It was followed up by other media including the Daily Mail and the Daily Telegraph while Wilson appeared on both BBC and Channel 4 News.

The Kent-based landlord said he would be evicting his 200 tenants on benefits, accounting for about a fifth of his 1000-property empire in and around Ashford. He said Eastern Europeans made better tenants.

He told The Guardian: “Tenants on benefits are competing with eastern Europeans who came to the UK in 2005 and have built up a good enough credit record to rent privately. We’ve found them to be a good category of tenant who don’t default on the rent. With tenants on benefits the number of defaulters outnumbers the ones who pay on time.

“Single mothers on benefits have been displaced to the bottom of the pile; sympathy for this group is disappearing. There aren’t enough places for people to live.”

On Monday night he told Channel 4 news the decision was purely based on financial reasons, and that rent arrears were running at more than 50% in the homes he let to those receiving benefits.

His comments caused on outcry and reignited warnings that some areas of the country would become “benefits blackspots”.

Affordable housing campaign group Priced Out described Wilson’s decision as “unbelievably heartless.”

Wilson’s comments comes after figures from the National Landlords’ Association published in December, which showed that the number of private landlords letting to people on benefits has halved to just one in five.

George Spencer, chief executive officer of online lettings company Rentify urged landlords to consider the implications of such blanket bans on those receiving benefits.

“Not only could they significantly limit your chances of finding new tenants, they could also lead to public outcry, a backlash against landlords and further regulation,” he warned.

“Under the current Housing Benefit system, the amount a tenant can receive is based on the cheapest 30% of properties in the area. This means that 1/3 of homes in your area should be affordable to those on benefits. If your property is in that bracket you should have a large market of benefits tenants available to you. Of course, this becomes more cloudy under Universal Credit where the tenant receives one lump sum for all of their benefits and must budget accordingly.

“The big worry is that landlords (generally) will not receive rent directly from the council, creating more uncertainty. But there are still many things landlords can do before bringing in a ban on benefits tenants. And each case must be judged on its individual merits.”

More in the Guardian HERE

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