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Tax relief for landlords will help to relieve Londonís housing crisis

Released on 29 January 2013

Action must be taken now to bring private landlords back into the market for housing homeless people, London Councils has urged today. 

The withdrawal of private landlords has meant that councils have had no choice but to put up homeless people in temporary ‘bed and breakfast’ accommodation.  Private sector rented accommodation has traditionally been the main way in which councils met the need to house homeless people permanently in the capital.  

In the most recent figures, London’s councils were having to accommodate nearly 900 families with children for more than the six week period set out in Government guidance.

The number of private sector landlords willing to let to homeless people on benefits has dropped by around 20% in the last year, according to a survey of London housing directors by London Councils- the umbrella organisation for London’s boroughs.

Private sector landlords no longer need to rent to homeless people on benefits because the lack of housing in the capital promises both continually rising rents and a ready supply of tenants in employment. Landlords also see such tenants as more secure compared to tenants on benefits, particularly with uncertainty about how changes in the benefits system might impact on their ability to pay.

These market conditions also mean that councils are now in a very weak position when attempting to negotiate rents down.

London Councils has been in discussions with the Department for Communities and Local Government (DCLG) about a programme of action to bring private sector landlords back into the social housing market.

These include tax relief for landlords to increase the supply of private sector rented properties, improvements to government schemes to bring empty private sector properties back into the market and better joint working between government departments and local government.

London Councils has set out a range of actions which the DCLG, alongside the Department for Work and Pensions (DWP) can work together to combat these challenges and in particular to bring more private sector properties back into the market for homeless people.

London Councils Executive Member for Housing, Mayor Sir Steve Bullock said:

“While we need to address the long term housing shortage in London, we need to act now to tackle the acute housing crisis in the capital - primarily caused by the chronic shortage of temporary accommodation available for councils to place homeless Londoners.

“While local authorities have been doing their very best to mitigate the impacts, we need a concerted effort by central government departments and councils to take action to ensure a supply of good quality, affordable homes in the private rented sector.

“Londoners deserve to have safe, affordable and secure places to live.  We hope to work alongside the government to make this a reality.”

Notes to editors:

1. London Councils has been meeting with officials from the Department of Communities and Local Government and the Department for Works and Pensions to manage the introduction of welfare reform and to help ensure that the immediate housing crisis in London is tackled effectively and swiftly.

2. London suffers from a chronic lack of housing supply, with an expected 38,000 homes needed to be built every year just to keep pace with known demand and an expected population increase of more than 9 million by 2025.  London Councils argues the only answer is increased investment in building new homes. The problem and one solution is outlined in ‘Meeting Londoner’s Housing Needs: Investing in Housing’.

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