Over 200 millionaires have been created among landlords and agents in the last three years by the housing benefits system.
Last night’s Dispatches programme on Channel 4 used Freedom of Information requests to the country’s 60 biggest local councils to obtain the data. However, no big letting agents were named.
The programme named three agents – Manlow Developments, B & R Estates, and Pointview Estates. All have appeared online before with other names mentioned.
Altogether, the programme claimed that private landlords receive some £9bn a year from the housing benefits budget – and it accused some letting agents of milking the system.
The programme showed how the private rented sector is the fastest growing provider of housing for those on housing benefit.
It also featured a number of letting agents in north London allegedly converting properties into tiny self-contained multi-lets.
Each has a small shower room and basic cooking facilities – little more than pans – meaning that they could be eligible for the higher rate of housing benefit, which can often be more than double the rate of a room in an ordinary shared property.
The Dispatches programme, Housing Benefit Millionaires, examined two such properties in Brent, north London, and found one letting agent collecting nearly £80,000 per year and another nearly £70,000.
One of these agents, believed to have almost 100 such properties, was said to have earned at least £2m over the last three years from housing benefit.
A group of London councils including Greenwich, Hackney, Haringey, Lambeth, Lewisham and Southwark have become increasingly concerned by the multi-lets model and plan to inspect 1,500 such units.
The programme also looked at how some councils are offering private landlords financial incentives to rent their properties to people on benefits.
The Dispatches team secretly filmed one letting agent revealing that they receive between £800 and £1,000 from local authorities to find rooms for housing benefit tenants.
Dr Victoria Cooper, lecturer in social policy at the Open University, told Dispatches that “approximately 40%” of the housing benefit budget is spent on the private rented sector.
Lawyers acting for the agents told Dispatches that the agents refuted all the allegations and would continue to “work with local authorities to provide much-needed accommodation”.
A spokesperson said: “Our companies manage a number of properties in London and across the UK. Each one is subject to the regulation of the appropriate local council, is inspected by them and subjected to independent certification generally.
“We have an excellent working relationship with each council.”
Comments (7)
The councils are effectively condoning the over priced bed sit type accommodation shown on this program by paying out the sums demanded. It again throw doubt on how councils deal with these matters. On one hand they call landlords rogues when they overcrowd properties and then pay for such accommodation because they have no where to house people. Government select inflicted wounds in my view.
Hmmm so it’s our fault?
Nothing to do with the people that claim benefits then, our fault.
Seems legit
It sounds like they thought that the billions of Pounds of Housing Benefits were kept on an altar by the recipients, but have just discovered that the recipients actually spend the money to pay for housing.
Considering the
Considering the housing situation, multi-lets seem like a good idea.
Multi lets are a good idea but only if the landlord ensures that those living in the property are not causing anti social behaviour that is affecting the neighbourhood.
My elderly parents live next to a property owned by B&R Estates and they have had nothing but issues from parties, police being called, condoms and rubbish thrown out of windows for over 2 years now.
Croydon Council will not do a lot about this as they are using the property to house emergencies. B&R Estates do not care as long as they are getting the housing benefit of the tenants.
Yes, everyone has a right to live somewhere but as they are meant to be “temporary” residents, they do not care who they upset whilst living there
If the government and local authorities had not asset stripped council housing they would not be paying out so much to the private rented sector. Re introduction of council housing and not asset stripping the housing associations would assist keeping the social housing bill lower.
Precisely what I was going to say.