News & stories Homelessness Explained Why are councils and charities paying millions in cash incentives to landlords? When it comes to property, London is tight on space and big on expense. Whilst there is a lack of social housing available, there is a huge demand for private rented accommodation. This drives the price of rent up for low-income families and individuals. Londoners who have to rely on our welfare system don’t receive enough in benefits to afford many of the rents in our city. This means that landlords are less likely to house people experiencing homelessness as tenants as they may fall into rent arrears. To encourage landlords, an incentive scheme was introduced. This scheme sees councils and charities paying ‘sweeteners’ to landlords to persuade them to accept people on housing benefit as paying tenants. The one-off, up-front payments vary quite a bit but have been known to be up to £8,300. This is a waste of public money and creates a climate for increased evictions and homelessness. We need to build the right environment for everyone in our city to thrive. We’re calling for change. Why is the incentives scheme a problem? There are a number of issues with this scheme: Sometimes landlords make councils and charities compete against each other and the property goes to the highest incentive bidder. This means councils can end up paying above the odds just to secure a roof over the head of a paying tenant. Landlords are effectively motivated to either issue short-term tenancies or end longer-term ones early in order to claim the next cash incentive for a subsequent tenant. Whilst this incentive practice is in place, councils and charities have no choice but to carry on paying these sweeteners to ensure their clients find safe, secure homes. Councils and charities should focus their money on initiatives that help people to stay in their homes. Money should not be wasted on costly, short-termist solutions that do nothing to address rising homelessness. What can be done about this? We’re calling on the Government to ban this ludicrous incentive scheme. We want to see this public money reinvested in tenancy sustainment services that help people stay in their own homes. We know from our services across London that when you give people a chance and focus on long-term solutions, everyone wins. Landlords receive the usual rent deposits and gain the financial stability that long-term tenants bring. Tenants benefit from the support and security they deserve. Councils can be reassured that public money is spent on a long-term solution that reduces homelessness. What is a tenancy sustainment service? Tenancy sustainment services include debt and money management advice, mental health support and mediation between landlord and tenant when needed. Homelessness doesn’t define you. It is an experience, not a forever. And with the right systems in place, it can be ended.