New Research Shows Majority of Landlords Say No to DSS Tenants

New research shows that eight out of ten landlords say ‘no’ to LHA tenants, with just 18% happy to let to this group.

The study*, conducted by The Online Letting Agents, also reveals that 82% of landlords believe  LHA tenants do not care for the property in the same way as private tenants and the majority of landlords (80%) believe that LHA tenants are much more unreliable  than private tenants, when it comes to rent arrears. (*Source: Survey amongst 300 landlords, May 2014).

Eleanor Carroll, Director of The Online Letting Agents commented: “Growing numbers of Britain’s army of 1.4 million private landlords are increasingly refusing to let property to tenants on benefits. Mortgage lenders and insurers are also growing wary.

“Their main reason for landlords turning away housing benefits tenants is the Government’s welfare reforms.  Many landlords have adjusted to LHA after its introduction in 2008.  However, recent limits on housing-related benefits and the introduction of ‘universal credit’ have caused concerned for many landlords and pose too much risk for some.

“Another influencing factor is that LHA is set at a local level through a formula where, in theory, the payable benefit compares with the rent of the cheapest third of properties available in the wider market that have the same number of bedrooms. In practice, open-market rents in some regions have outstripped the LHA calculations. It’s very much regional.  In some areas of high demand there is a large and widening gap. In other areas like the North East there is not much difference between the LHA and market values.

“According to the National Landlords’ Association (NLA), the proportion of landlords prepared to accept tenants receiving LHA has more than halved in three years. In mid-2010, 46% of the NLA’s members let to tenants who received the benefit. By the end of 2012, this had dropped to 22%, and the decline steepened throughout 2013.

“In spite of all this, the fact remains that benefit claimants remain more profitable than many types of tenants.  According to the latest data on landlord returns, letting property to those on benefits delivers excellent returns. Approximately 100,000 landlords deliberately target this market.  The average yield for this type of let is 6.6%, calculated as rental income against the price of the property and this is higher than for any other tenant group, except migrant workers. By contrast, the lowest yields arise in the letting of properties to executives.”

The Online Letting Agents offer landlords full management, tenant find and referencing services and advertises properties on all the major UK property websites. For further information, visit or call 03300 883 973.

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