Because councils are restricted to finding properties which are affordable to tenants on low incomes, their challenge is reaching out to landlords who let out their properties well below average rent.
I’m not sure landlords letting out properties at the bottom end of the market always want to be visible to the state. A third sector organisation matching landlords with tenants recently confirmed to me that in their experience, landlords can be wary of getting involved with councils.
Why is that? Well, there is the thorny issue of tax. When we asked landlords if they were confident that they were paying the right tax, only 77% strongly agreed. Of the rest, some just disagreed, couldn’t answer, or only tended to agree.
Landlords in a precarious financial position may also be understandably worried about being required to do repairs to bring properties up to scratch. Councils have to simultaneously find accommodation which is cheap, but they are also required to guard against poor conditions.
But probably the most important factor in London’s rental market is that landlords (even those renting properties at the bottom of the market) can go it alone and probably get more rental income than they can from renting to LHA claimants.
There isn’t a simple solution to helping locked out renters, but councils can’t rely on attracting ‘philanthropic’ landlords via trendy websites to house low income families.
Local councils will struggle to coax those landlords who already run profitable businesses, especially those predicated on renting out run down accommodation.
Even finding landlords in the first place is a challenge: of the landlords we surveyed, only 10% had been in contact with a council through their website in the last year, and even fewer had visited the council in person.
The Mayor and local authorities need to work together and get into the underbelly of the rented sector, understand what motivates landlords and design appropriate incentives.
Some landlords will let to low income households with the right financial incentives, such as rent being paid for in advance. Others can be persuaded to offer their properties to families desperate for somewhere to live, in exchange for help to bring their property up to standard.
Let’s hope the next Mayor takes this challenge up and stems the growing tide of homelessness in London created by families being locked out of renting.
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