If you are a landlord, of course, you want to pick and choose the tenants you invite to occupy your property. When marketing your property, you probably have a target demographic in mind and grant your tenancies accordingly.
When drafting your advertisements and listings for your property, however, you must be careful not to specifically exclude a whole class of potential tenants – that might be considered discrimination and, therefore, illegal.
The precedent
That important precedent has been set by the recent decision of the York County Court and reported by the housing charity Shelter last month.
In a landmark case, the District Judge ruled that a landlord – and the letting agents he instructed – who had turned down an application from a single mother because she was in receipt of housing benefit represented discrimination. Such unlawful discrimination is a contravention of the Equality Act 2010, explained the BBC in a report of the judgement on the 14th of July.
The landlord and his agents had expressly exercised a policy to reject applications from any prospective tenants in receipt of housing benefit.
How to avoid the pitfall
According to a survey cited by Shelter, some 63% of all private sector landlords say they would not let to – or would prefer not to let to – tenants who receive housing or other welfare benefits.
This is a hangover from the days when the advertisements posted by many landlords specifically stated “no DSS”. The meaning was no recipients of benefits issued by the Department for Social Services.
Although the Department of Social Security (DSS) was wound up in 2001 – and its functions transferred to the Department for Work and Pensions (DWP) – some landlords continue to hold to a policy of “no DSS”. By so doing, it is now clear that they are breaking the law.
In an article on the 27th of July, letting agents, OpenRent explained that while landlords, of course, are free to select tenants on the relative merits of individual applications, where they fall foul of the law is any blanket policy of exclusion. Policies need to be worded carefully.
Thus, a blanket ban written as “no benefits claimants” or the old-fashioned “no DSS” risks contravention of the Equality Act – especially if the applicants discriminated against are women or disabled people who receive housing or other welfare benefits.
Nevertheless, suggests OpenRent, some landlords might steer clear of breaching the law by remaining silent about their policies in any advertising, yet who continue to operate a discreet or “secret” ban on applicants in receipt of benefits.
If you want to avoid breaking the laws on equality, therefore, make sure that your advertising of any let property does not discriminate against any specified group of applicants – not only those on welfare benefits but also students or the unemployed, for example.
In the light of the details revealed through individual applications, however, you may still decide to decline those where you have reason to believe a potential tenant may not be able to comply with the terms of the tenancy and the payment of rent.
Of course, if you are happy to accept any tenant type, you can include this in your advertising, such as saying: “DSS welcome” and so on.
It is important that any letting agents you appoint to help fill vacancies are also aware of the general openness of your policies and your concern to avoid any suggestion of discriminatory behaviour or decision-making.
Landlord insurance
If you have ever shopped around for landlord insurance, you are almost certain to have discovered that some providers specifically exclude cover in the case of lettings to certain groups of tenant – most commonly, benefits claimants, students, or the unemployed.
It remains to be seen whether any such policy on the part of insurance providers may also run foul of the Equality Act – since that possibility has yet to be tested before the courts.
Whatever position the courts might eventually take towards such matters, you may rest assured there is no such doubt or confusion as far as landlord policies provided by us here at UKinsuranceNET are concerned. We make it crystal clear that all our landlord or buy to let insurance policies are valid whatever the section of society from which your tenants are drawn.
We do not discriminate against any particular group of potential tenants and rely on you, the landlord, to exercise due diligence when selecting individual tenants on whom you may reasonably rely to abide by the terms of any tenancy agreement you may grant.
