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Zoopla to ban benefits restrictions in rental adverts

Property advertising platform Zoopla is set to change its terms and conditions to prohibit renting restrictions for tenants in receipt of benefits.

The move follows calls by the government and charities for lenders, insurers, property agents and ad sites to review their approach to ‘no DSS’ discrimination.

A campaign to lift such restrictions began last year when one landlord claimed NatWest threatened to revoke her buy-to-let mortgage when the bank discovered she was renting to a benefits claimant.

Helena McAleer, a landlord from Northern Ireland, contacted the bank to discuss releasing equity from her property – but instead Ms McAleer claimed the lender revoked her mortgage citing its policy prevented rentals to benefits claimants.

At the time NatWest’s buy-to-let eligibility criteria read: “We will not consider multiple tenancies, Homes of Multiple Occupancy, bedsits, DSS tenants or ‘Related Person’ tenancies.”

The campaign gained widespread support, with the Residential Landlords Association calling on the government to use its influence as a shareholder in certain banks to end the “discriminatory” practices.

In 2017 research by the RLA found 66 per cent of lenders representing 90 per cent of the buy-to-let market did not allow properties to be rented to tenants in receipt of housing benefit.

At the beginning of this month NatWest lifted all restrictions on its buy-to-let customers renting to tenants in receipt of housing benefits.

Zoopla has now followed suit, announcing it will launch additional measures over coming weeks in support of “further minimising blanket restrictions” which apply to renters who receive housing benefit.

Due for implementation in April, Zoopla will amend its member terms and conditions to “specifically prohibit” the inclusion of “no DSS” restrictions on its site, remove “no DSS” references from listings uploaded on its site and remove the “no DSS” field in its cloud-based software products.

Charlie Bryant, managing director of Zoopla, said: “We fully support the recommendations of the National Landlords Association and the Residential Landlords Association, which oppose blanket bans against tenants in receipt of housing-related benefits, and are pleased to be taking action which clarifies this position.

“All tenants who are looking to rent a property deserve the chance to be fully assessed for their suitability and matched to a home that suits both their and the landlord’s circumstances.

“We proactively sought the views of our largest lettings-focused agents to ensure the above measures were undertaken on a collaborative basis and received significant support in respect of our proposed additional measures.”

Natwest and Co-op banks, Kensington Mortgages, Nationwide Building Society have been invited to give evidence on their policies in relation to tenants in receipt of benefits – the date was originally set for March 20, but this has now been postponed.

By Rachel Addison

Source: FT Adviser

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One in ten rental properties listed on Zoopla specify ‘no benefits tenants’

One in ten rental properties being advertised on Zoopla explicitly exclude anyone who is claiming benefits, research claims.

Analysis by the National Housing Federation (NHF) of 85,912 properties listed for rent across England on Zoopla this year found 8,710 that openly said “No DSS” or similar.

Separately, Shelter has conducted a mystery shopping exercise on Gumtree and SpareRoom.co.uk, finding that applicants who mentioned that they were claiming benefits were more than twice as likely to get negative responses as those who did not.

While it is not unlawful to refuse to let to people on benefits, Shelter has earlier argued that excluding benefit claimants is discriminatory and has been rumoured to be considering a legal case under the Equality Act.

The issue has prompted much debate on EYE, with agents stating it is landlords who want this exclusion due to the perceived higher risks of rental arrears, while groups such as the Residential Landlords Association have blamed the terms and conditions set by mortgage lenders.

The NHF said that the “blatant discrimination” against people on benefits must stop.

It has issued a series of recommendations.

It calls for agents and their professional bodies to ensure all renters are treated equally, and that such exclusions are refused on listings sites.

It also wants landlords to stop using letting agents who advise against letting to tenants on housing benefit. The NHF said landlords should instead assess each tenant based on the property and whether they can afford it, rather than where the money comes from.

The NHF said: “We are calling on everyone involved in the lettings industry to take action to stop the unfair treatment of people who claim housing benefit.

“This change requires agents, landlords, mortgage lenders, insurance providers and the Government to commit to ensuring that all renters are treated equally, regardless of whether they claim housing benefit.”

Separately, Universal Credit has been blamed for a spike in buy-to-let mortgages that are in significant arrears.

Data from UK Finance shows that the number of buy-to-let loans with more significant arrears of 10% or more was up 3% annually to 1,150.

Mark Pilling, managing director at Spicerhaart Corporate Sales, which deals with arrears and repossessions on behalf of lenders, said these figures suggest issues with Universal Credit are starting to impact landlords.

He said: “Last month, the Residential Landlords Association revealed that 61% of landlords with tenants receiving Universal Credit have had problems with non-payment and arrears, and on average, these tenants owe 49% more than they did a year ago.

“Universal Credit has been plagued by problems since it was introduced, and while the Government announced in the Budget that more money will be dedicated to the new welfare system, it is clear that much of the damage has already been done.

“Many claimants experienced huge delays in receiving their money, forcing them into arrears, and many are receiving far less than they did with the old system, which means in many cases they simply do not have enough money to pay their rent on their reduced incomes.

“From a lender’s point of view, it is important that they keep a close eye on their buy-to-let customers who have tenants who are on or are soon to be moved on to Universal Credit so they are able to work out the best solution for those who are struggling so that repossession is a last resort.”

Source: Property Industry Eye