The Competition and Markets Authority (CMA) have published guidance advising against putting wording in rental property adverts that constitutes a ‘blanket ban’ on applications from tenants getting state aid towards the payment of their rent, unless it’s a specific requirement of a landlord’s mortgage. This means an end to phrases like ‘No Housing Benefit’, ‘No DSS’ and similar.
In a recent landmark court case a letting agent was sued (and settled out of court) for sex discrimination because of a ‘no DSS’ clause in their listings, the logic being that because the majority of claimants are women the ban was illegal under equality laws.
Going further than the CMA (most probably in fear of being sued) Rightmove and Zoopla have banned agents from putting that kind of wording into rental property descriptions.
You can still reject applicants you don’t want, you just can’t state it in ads. This will simply mean more time wasted by everybody. If you are determined not to take benefit claimants my suggestion would be to make it clear as soon as they enquire that you require a working, home-owning guarantor from all benefit claiming applicants. If they can’t supply that then there’s no need to progress any further. However as always using your discretion in individual cases can work in your favour - a nice, working single mum who has small children in local schools might well want to stay put for a decade or more, making them a great choice to avoid void periods, especially now there is no money to be made in fees from a tenant changeover.
It’s getting pretty clear now that even nominally Conservative governments have it in for private landlords, with Section 21 likely to be banned, the tenant fee ban, the abolishment of 10% wear and tear allowance, the 3% stamp duty increase and the coming mortgage relief changes that will have a number of landlords actually paying tax when making a loss! However property is still a good investment in my opinion, you just have to be more careful than ever before to choose the right property and the right tenants.