GMLC comments on the widely reported news that Manchester City Council spend more than any other local authority on ‘incentive’ payments to landlords, explaining the context and giving a case study from the Housing team’s work enforcing people’s homelessness rights.
This month, research from Generation Rent that found that, in 2024-25, English councils spent £31m in one-off payments to individual landlords in incentives for housing homeless people. These payments seek to induce private landlords to accept homeless households as tenants, even though they are often seen as ‘risky’ or ‘undesirable’ tenants due to their low incomes or the stigmatisation homeless people unfairly face.
Manchester City Council was found to be the local authority spending the most on landlord incentives, surpassing all London local authorities. In 2024-25, MCC spent £3.3m in public money on these payments.
Golden hellos, top-ups and rent in advance
At GMLC, we are well aware of this phenomenon. Manchester City Council employs a whole team of staff members whose job is to match homeless applicants with private tenancies, often for rents which far exceed each household’s ability to pay them. In addition to ‘golden hello’ payments at the start of a tenancy, the local authority will offer landlords rent in advance and top-ups to housing benefit for up to a year to cover rents that exceed Local Housing Allowance.
It is usually left unclear how the tenants placed in the property will afford the rent after the top-up ends – they are simply expected to apply for discretionary help, or fend for themselves. Many of these tenants become homeless again after their 12-month tenancy because they can’t afford the rent, or the landlord evicts them to take another homeless tenant from the Council, with another incentive payment at the outset.
If a homeless person does not accept an unaffordable private rented offer, shocked by the rent level or unable to accept the condition or location of the property, the local authority will often claim they have no further duty to make any more offers, and label the household as ‘intentionally homeless’ (a category which then excludes them from further homeless help).
Sometimes, the companies who own the private houses the Council use are set up specifically for this purpose: to rent to homeless people and pocket the extra money as profit. Sometimes, the houses these landlords own are former council homes, sold through Right-to-Buy in the past and then purchased by a private landlord to rent out.
Case study: Fiaz
Our client Fiaz is a perfect example of what we are seeing a lot at the moment. Fiaz was street homeless when he approached us in 2024, suffering with physical and mental health problems and recently out of hospital. Due to his health problems, he needed self-contained accommodation, and was reliant on Universal Credit for his income.
Fiaz was placed in a hostel as temporary accommodation by Manchester City Council, where he stayed for many months. In January 2025, he was offered a privately rented flat in Manchester for £800 per month before bills, which exceeded his Local Housing Allowance entitlement. Fiaz worked out that he would have less than £200 a month for food, transport, toiletries, clothes and essentials if he took the flat, as he would have to pay the £25 per month shortfall in rent as well as all his own bills – water, electricity, gas and internet. When he said he would struggle to afford this, the Council terminated his homeless duty and gave him an eviction notice from his temporary accommodation.
GMLC helped Fiaz with a review of the suitability of the Council’s offer, which eventually succeeded – but others without representation simply fall out of the bottom of the system, and return to street homelessness or sofa-surfing.
Long term solutions to the homeless crisis?
Despite the suffering caused by these policies and the arguable misuse of public money it represents, we understand the predicament the Council finds itself in. The need for this approach comes from decades of mismanagement of the housing sector across England. No-fault evictions, uncapped rents and the selling off of public housing stock have all contributed to the current crisis. But the situation is especially bad in Manchester, where private developers regularly buy their way out of providing affordable housing, where rents have soared well above Local Housing Allowance levels, and where a flow of people coming into the city looking for work, education or community creates intensified demand for housing that can be exploited by those who own property.
Building more social housing and limiting Right to Buy are absolutely crucial if we want to reduce homelessness – which are already on the government’s agenda. But there are other policies that would make an immediate impact. Rent controls would stop landlords from price-rigging the ‘market rent’ with rent increases to make maximum profits. Planning loopholes could be closed to prevent developers from shirking in their responsibility to build affordable housing. Legal Aid provision could be boosted to stop homelessness at one of its root causes – eviction – rather than relying on the homelessness system to absorb landlords’ decisions.
GMLC would like to see more proactive policy-making to tackle homelessness in the long-term in place of the market-oriented policies represented by Manchester’s approach over the last decade.
