Generation Rent has accused landlords of “rigging the system to line their own pockets” after new figures revealed that councils are spending millions in one-off incentive payments to secure private tenancies for homeless households.

Through Freedom of Information requests to 42 councils, the campaign group found that 37 local authorities spent over £31m on landlord incentives in 2024/25, paying out on 10,792 occasions.

Spending has risen sharply: compared to 2018, London councils spent £8.5m (54%) more, with six boroughs paying individual landlords £10,000 or more—whereas just one such case was reported in 2018.

The highest annual spending was reported by:

• Manchester City Council – £3.3m

• Enfield Council – £2.7m

• Ealing Council – £2.2m

• Birmingham Council – £1.6m

• Nottingham Council – £1.6m

The largest single payments included £15,385 from Southwark Council, £13,500 from Camden, and £13,000 from Hammersmith & Fulham.

Ben Twomey, chief executive of Generation Rent, criticised the practice, saying: “The rental market is like the wild west. Landlords are often a law unto themselves, rigging the system to line their own pockets at the expense of people experiencing homelessness and the local councils that are trying to house them. In a desperate bid to avoid placing people in temporary accommodation, councils are forced to pay landlords tens of thousands of pounds just to agree to let their homes. It’s a senseless waste of public money.”

However, the National Residential Landlords Association (NRLA) defended the incentives. Policy director Chris Norris argued that they help cover costs and encourage landlords to take on higher-risk tenants, such as those leaving prison or struggling with substance abuse.

He told The Guardian:  “Frankly, it does a job and it’s probably the least bad option available to a lot of local authorities at the moment. It helps landlords cover their costs and to offer accommodation, but it would be far more efficient and equitable if the government actually ensured there was a welfare system that allowed people to access homes in the first place.”