Crisis warns of “homelessness trap” as landlords say too risky to rent to homeless people

Crisis and leading landlord groups call on government to help homeless people find a home to rent

Homeless people are finding it harder and harder to secure a place to live as the vast majority of landlords now consider it too risky to rent to them, according to Crisis, the national homelessness charity.  

With growing numbers stuck in this “homelessness trap”, Crisis has launched a major new campaign - Home: No Less Will Do - calling for action to help homeless people secure a home to rent. Backed by leading landlord groups, including the NLA and RLA, the campaign calls on the government to extend the kind of support now offered to first-time buyers to homeless people looking to rent. 

Drawing on a survey of more than 800 private landlords across England, new research by the charity shows how landlords are increasingly reluctant to rent to homeless people and those supported by benefits. It shows how more than eight in ten are now unwilling to rent to homeless people because of concerns which included rent arrears and the need for more intensive tenancy management. The majority reported that recent welfare reforms had made them more reluctant to rent to homeless people and those supported by benefits (see key findings).

The report warns that, as a result, homeless people are finding it increasingly difficult to secure a place to rent, with many struggling to afford upfront costs such as a deposit, rent in advance and agent fees. A survey of homeless people conducted for Crisis found that nearly three quarters said these difficulties had prevented them from securing a tenancy.

Jon Sparkes, Chief Executive of Crisis, said: “If you’re homeless, private renting may be your only hope of finding a place to live. Yet homeless people are finding it harder and harder to secure a private tenancy. That’s why we’re launching our Home: No Less Will Do campaign to make sure renting works for both homeless people and landlords.

“In a highly competitive rental market, homeless people are increasingly left with fewer opportunities to rent, and many simply can’t afford the upfront costs. This is a desperate situation to be in: to be ready to move on and start rebuilding your life only to encounter financial barriers and closed doors.

“We need action to tackle this homelessness trap. We need to find ways to reassure landlords whilst supporting homeless people to find a place to live. We’ve spent years working with schemes that help homeless people access and sustain tenancies, and we know that with the right support, this can be a win-win situation for both tenants and landlords.

“The Government already helps first-time buyers struggling for a deposit; it’s only fair they extend this help to those who need it most.”

With private renting increasingly important for housing homeless people, Crisis is calling on the government to ensure support is made available to homeless people and their landlords. In particular, the government should: 

• Create and underwrite a national rent deposit guarantee to help homeless people rent
• Fund projects that provide tenancy support to homeless people and landlords
• Introduce a quality mark for projects supporting homeless people and landlords

Chris Norris, Head of Policy, Public Affairs and Research at the National Landlords Association said: “For most landlords, the best sort of tenant is someone who will make the place their home. People treat homes with respect and they want their tenancy to work out. Many landlords will be anxious about renting to a homeless person – they worry about whether they’ll be able to pay the rent, or if they’ll need more support compared to other tenants. And unfortunately, this perceived risk can become an obstacle to that person finding a place to live.

“Schemes that help homeless people into private renting can also help reassure landlords and remove some of these more risky elements. It’s a win-win situation: a homeless person finds a stable place to live and the landlord finds a tenant who wants to stay and make the house their home. That’s why we’re backing this campaign and calling on the government to take action.”

David Smith, Policy Director, at the Residential Landlords Association said: “The vast majority of landlords and tenants want the same thing – a stable, secure tenancy they can both rely on. It is expensive and time consuming for a landlord to find a new tenant and most landlords will do all they can to keep tenants in their homes rather than face an empty property. Many landlords would be much less reluctant to rent to people who were homeless if the risks could be better managed.

“As this campaign rightly highlights, there is a pressing need for better resourced support for homeless people and their prospective landlords.”

Key findings: 

• 82% of landlords are unwilling to rent to homeless people Reasons included a perceived greater risk of rent arrears (80%) and need for more intensive management (73%)
• 55% of landlords said they were unwilling to let to tenants in receipt of housing benefit
• 84% of local authorities surveyed said that over the past five years it has become more difficult for single homeless people to access private renting
• Two thirds (65%) of landlords said that direct payments under Universal Credit had made them more reluctant to rent to homeless people and seven out of ten (68%) said it made them more reluctant to rent to tenants receiving housing benefit.
• Half of landlords (51%) said the caps on Local Housing Allowance had made them more reluctant to rent to tenants receiving housing benefit
• 18% of landlords said they had increased the deposit when renting to someone who was homeless; 16% had increased the rent; 34% made more use of guarantors and 35% took up references more extensively
• Eight of ten homeless people surveyed reported difficulties raising a deposit, while nearly three quarters (73%) had difficulty raising the requisite rent in advance.

ENDS

For further information call 020 7426 3853 or email thomas.phillips@crisis.org.uk. For out of hours media enquiries please call: 07973 372587

Notes to editors
 

1. Crisis commissioned the Centre for Regional Economic and Social Research at Sheffield Hallam University to conduct research exploring homeless people’s experiences of accessing the private rented sector. The study was conducted from October 2015 - February 2016 and comprised an email and postal survey of 948 private landlords, 806 landlords stated that they did not have any property in Scotland which the figures in the press release refer to, a face-to-face survey of 103 homeless people, and an email survey of 58 local authorities.
2. The survey conducted with tenants is a small sample size and results should be treated with caution.