Over representation
On the 1st July 2020, district judge Victoria Mark ruled on this latest case in York County Court saying:
"Rejecting tenancy applications because the applicant is in receipt of housing benefit was unlawfully discriminating on the grounds of sex and disability".
The official recordings of the ruling on 1st July are as follows:
The Declaration
“The Defendant’s former policy of rejecting tenancy applications because the applicant is in receipt of Housing Benefit was unlawfully indirectly discriminatory on the grounds of sex and disability, contrary to sections 19 and 29 of the Equality Act 2010.”
Women ruled to be put at a disadvantage
Judge Victoria Mark went on to specify how the standard policy to benefit claimants affected women, saying:
“A No DSS policy puts or would put women at a particular disadvantage. 53.1% of female single-adult households renting privately claim Housing Benefit compared to 34% of male single- adult households. When households with couples are included, 18.8% of women renting privately claim Housing Benefit compared to 12.4% of men.
This means that, in the private rented sector, using whichever of the two analyses set out above, women are more than 1.5 times as likely to rely on Housing Benefit, and thus be excluded by a No DSS policy, than men.”
How 'no DSS' was ruled to affect the disabled
Additionally women were'nt alone in those affected by the policy, Judge Victoria Mark went on to say:
“A No DSS policy puts or would put persons who are disabled at a particular disadvantage. 44.6% of households who claim DLA or SDA claim Housing Benefit compared to 15.1% of households who do not claim DLA or SDA.
This means that, in the private rented sector, disabled households are almost three times as likely to rely on Housing Benefit, and thus be excluded by a No DSS policy, than non- disabled households”
What does this mean for Landlords?
It’s worth noting that the recent decision was made at a County Court level, meaning the ruling is relevant but not binding.
Whilst it doesn’t mean housing will be any more affordable, it does mean that a DSS applicant will have to be considered on the details of his or her own circumstances and financial merit as opposed to an outright pre-ban.
Additionally many Landlords will also have mortgage conditions prohibiting a letting being made available to tenants in receipt of DSS. Due to the recent ruling, mortgage lenders may indeed resile these stipulations or at least be open to an easing during the application process.
In this regard, due to the recent changes being barely a month old, there’s isn’t a huge amount of advice from UK lenders. However it is important to note that landlords and letting agents can still reject a state funded tenant if the renting criteria can’t be met, as they would with any other tenant.
So what now?
Orientating oneself to the new ruling can be confusing so to make a more informed plan, we’ve set out the following pointers to help guide you through the new DSS rulings.
1) A DSS income is (for most of the time) fairly reliable as it comes from government even though the tenant for most of the time is obliged to cover a shortfall themselves
2) As rental payments are created by a local Council and made to the tenant, any issues with payment can then be taken up with the Council themselves, which is easier than taking them up with someone who could vanish overnight!
3) A ‘Warm Front’ grant is available to people who own a home and receive DSS payments. The grant provides energy efficiency advice and tailored heating improvements to the tune of £3500-£6000!
4) Sadly, most DSS tenants are classified as ‘high risk’ by e.g banks and insurance companies, for a very simple reason, their cashflow is limited. Banks struggle to give loans to individuals with bad finances for the same reasons.
5) In recent years, a change to the law now means DSS payments aren’t directly channeled from the local council to the Landlord directly, but go to the tenant instead. As previously mentioned, whilst a local Council body can be relied upon to act as the middle man in any disputes (whilst still problematic as the below point highlights), the monthly rental payments aren’t as direct as they once were.
6) As a continuation from the above point, any local Council can snap their fingers and end an individual’s benefit payments instantly, which Landlords and agents have no control over.
7) Insurance cover for a tenant registered as DSS isn’t always guaranteed, and sometimes it can be outrightly refused or at least come with an eye watering premium.
8) Council’s can be problematic to deal with when there’s an issue with DSS payments. They will often actively tell the tenant to remain in the property even when rent isn’t paid, or may not give the landlord any notice when payments come to a halt.
